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Microsoft paying Novell $308 million for Linux pact
Morshad Morshad published 07 Nov 2006, 20:34 in main - 269 views
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ImageIn one of the more complex examples of "cooptition" in the computer industry, Microsoft will pay Novell a net amount of $308 million to market and distribute its competitor's product.

The five-year Microsoft-Novell partnership, unveiled last week, involves a mix of patent, technology and business issues. Novell disclosed details of the partnership in a Securities and Exchange Commission filing Tuesday.

Microsoft will pay Novell $240 million for 350,000 coupons--70,000 per year--entitling customers to support and maintenance for Novell's Suse Linux Enterprise Server, Novell Chief Executive Ron Hovsepian said Tuesday. In addition, Microsoft will spend $94 million over the five-year deal on its own sales and marketing work for Suse products.

Microsoft hopes the partnership will help the fortunes of its management software for virtualization, technology that lets different operating systems run simultaneously on the same server, said general counsel Brad Smith. "The principal purpose of this is to enable us to take our virtualization solution to market," he said.

Icon News source: CNET News.com
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