Tuesday, November 7, 2006

Novell: Microsoft Deal Worth $240M+

Novell released the details of the firm's agreement with Microsoft to allow Windows customers to purchase SUSE Linux Enterprise subscriptions this afternoon, saying that Microsoft has agreed to pay Novell $240M in an upfront payment for its SUSE Linux enterprise Server subscription certificates. The deal also calls for $60M in marketing over five years to be dedicated by Microsoft for marketing joint Linux and Windows solutions, and $34M over five years to fund a dedicated Microsoft sales force for the offering. Novell said in a statement that the agreement also calls for Microsoft to not enter into an agreement with another Linux distributor for three years. Novell said that Microsoft will also make an up-front payment of $108M to Novell as part of its patent agreement, and that Novell will pay Microsoft at least $40M over five years based on percentages of Novell's Open Platform Solutions and Open Enterprise Server revenues.