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Novell Gets Serious about Europe


1986 was an important year for Novell’s European operations. Until that time, Novell had relied heavily on its European distributors for marketing, sales, and technical support. After three years of this approach, Ray felt ready to increase Novell’s investment and presence in this key market. In 1986, he allowed Judith to spend one-fourth (roughly $1 million) of her corporate communications budget on European promotions. Most of this money went on trade shows and conferences.

On March 6, Judith and Promotions Manager Anita Reece helped Andrew launch the first annual United Kingdom NetWare Affiliates Conference. Representatives from over 30 European software developers attended—16 of them newcomers to Novell and NetWare. “The whole day was a tremendous success,” said Andrew. “The entire concept of a manufacturer addressing software developers in this way is totally unique in this country. We were talking at their level and about things of relevance and interest to them. The overall reaction was one of great enthusiasm for this approach.”

Judith and Anita then proceeded to Germany to set up Novell’s booth at the CeBIT Hanover Fair, the world’s largest trade show for office, electronic, data, and communication technology. This was the first time Novell exhibited at the show, and its booth featured two LANs connected by an SNA Gateway: A 286A file server running NetWare ARCnet on three workstations linked with a NetWare 68B file server running S-Net on five workstations. The company also presented five seminars and played host at a dinner for distributors and another dinner for software developers.

One of the guests at the distributor dinner said, “The time is ripe for Novell to take the load in Europe. Novell’s presence at the show, combined with the support offered to distributors and resellers here, indicates the company’s total commitment to the European LAN market.”

At both the UK conference and the Hanover Fair, representatives of the International NetWare Users Group (INUG) made presentations. This group, like the user groups in the US, was organized with Reid’s help in 1985. It was important not only as a source of ideas and feedback to the NetWare designers but also as a demonstration of NetWare’s acceptance by major customers, so speeches by INUG members were important at gatherings of the independent software developers (“NetWare Affiliates”) whom Novell was trying to impress.

One result of the Hanover Fair was an OEM agreement between Novell and Bertelsmann AG of Hanover, where Bertelsmann translated both the manuals and screen text of Advanced NetWare 2.0 and marketed a German language version of Advanced NetWare for IBM PC networks. This was the first official foreign language version of NetWare.

Novell’s booth at Hanover Fair was followed by participation in two more European shows in 1986, both in London: The PC User Show in July and Compec in November. The booths featured two LANs linked by an SNA Gateway, similar to the demonstration at Hanover Fair. NetWare Affiliates also exhibited their LAN applications in the booths. “NetWare Everywhere” stickers and banners announced Novell’s presence throughout the booths.

Novell also took its first steps into international advertising in 1986. The first of a series of “Milestones Ahead” ads, released in May, appeared in translation in the various European markets. Although advertising was quite limited in 1986—it gradually expanded through 1987 and 1988—this was the first time the company had directly advertised its products to international end users. In 1986, the NetWare Centers in Germany and the UK also hired their own public relations companies (Henschel and Stinnes in Germany and Tom Burgess and Company in the UK) to issue press releases, handle media relations, and help with other PR activities.

The Market

In a LAN Times article (June/July 1986, p. 24), Joseph Wolf, an employee at the Düsseldorf NetWare Center who gave technical training sessions for distributors and dealers, described the market in Europe:

In Germany and France the computer industry has given local area networks (LANs) a lukewarm reception. The main interest there has been in minicomputers. Novell is meeting this challenge by showing that NetWare, with its ability to communicate with a variety of hardware systems, can be a valuable asset to such companies.

Spain, Italy and Great Britain, on the other hand, are eager for LANs, and NetWare has incredible potential in those countries, according to Wolf.

One of the areas of investigation is in utilizing NetWare to run large automated machining and milling operations. Though still no more than an idea, the concept of adapting a PC to run a lathe or other device, for instance, appeals to German heavy industry.

“When you have to coordinate the activities of an entire factory, the use of a stripped-down PC attached to a NetWare LAN to run one of the multimillion-dollar machines offers a very inexpensive and universal communication tool. Even when we have different types of machines from different countries, NetWare can talk to all of them,” said Wolf.

Wolf summarized by saying, “How many major computer firms do you have in the United States? Three? Four? In Europe, we have those same firms as well as three or four of our own, none of whose systems can talk with the others. Europe needs NetWare.”

From the same issue of the LAN Times (June/July 1986, p. 23).

While the London NetWare Center is finding success with its new distributors, the European NetWare Center is seeking distributors for Israel and Kuwait. Last year, the number one distributors in Europe were Holland, Germany, and France, respectively. The Scandinavian countries were also large sellers, [Jonathan] Whiteley said. He also pointed out that Spain and Italy are becoming more active.

In 1986, Novell’s international operations, like the rest of the company, were reorganized to incorporate the NetWare Center concept. As already mentioned (p. 199), two NetWare Centers were established in Europe: Slough and Düsseldorf. Suddenly these offices no longer confined their activities to sales and technical support; they became stocking distributors of NetWare and other products as well. The LAN Times article just quoted reported that the UK center was even “looking at the possibility of buying disk drives inside the United Kingdom; the center would then supply UK and perhaps other European customers with the disk drives.”

By mid-1986, Novell had lined up an impressive array of European and other international distributors, and the focus of activity had shifted to the ongoing business of training and supporting resellers and end users. Although 120 German dealers were selling NetWare by the summer of 1986, only 4 of these were authorized dealers who met the company’s training requirements and demonstration capabilities.

The other major focus of activity for Novell Europe in 1986 was the development of the International NetWare Affiliates group. By the summer, over 900 independent software vendors (ISVs) belonged to the group worldwide. The Düsseldorf NetWare Center sponsored a series of five seminars in various European capitals during the fall of 1986.

By the end of 1986, Novell was estimated to control at least 30% of the European LAN market—at least twice as much as its closest competitors. UK rivals—Torus, Apricot, Research, and others—trailed far behind the company from Utah. By mid-1988, according to that September’s LAN Times (p. 20), Novell’s share of the European market was estimated at 50%.

By 1988, Novell’s European operations (including the Middle East and Africa) accounted for about 75% of all international revenues, which, in turn, accounted for about 30% of all company revenues.

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