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Microsoft settles Novell dispute for £290m

Cliff Saran

Microsoft last week ended a 10-year legal battle with Novell, paying $536m (£290m) to settle an antitrust case related to Novell's Netware operating system.

The settlement will dramatically increase Novell's war chest to develop the SuSE Linux platform it acquired in January for $210m, according to Philip Carnelly, an analyst at Ovum. "This is a significant injection of cash and should help Novell fulfil its open source strategy," he said.

The Microsoft settlement is equivalent to almost half of Novell's $1.1bn revenue last year and is almost three times the amount it spent on product development in 2003.

News of the Microsoft deal broke as Novell released Linux Desktop 9, an open source alternative to Microsoft's Windows and Office desktop software.

The cash settlement will not end all of Novell's legal action against Microsoft. Novell intends to issue a lawsuit over its allegations that Microsoft attempted to eliminate competition in the office productivity applications market when Novell owned Word Perfect in 1994.

Microsoft has spent more than $2.8bn on antitrust and patent settlements in the past 18 months. It still faces antitrust action from RealNetworks.

The Microsoft/Novell settlement   

  • Novell gets $536m (£290m) to settle a 10-year dispute in which it alleged Microsoft manipulated the market for server operating systems 
  • Novell and the Computer and Communications Industry Association withdraw antitrust legal action pending in the European courts.

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