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Novell CEO steps down as it acquires consulting firm

Services will now be a third of its business

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Novell's long-standing chief executive Eric Schmidt is to step aside as part of a deal by the networking software vendor to acquire IT solutions firm, Cambridge Technology.

The $266m all-stock agreement to acquire Cambridge is seen by Novell as a means to expand its ability to offer consulting support to its customers and services partners, who are looking to deploy ecommerce and business applications across the Internet.

Novell board member Jack Messman, and president and chief executive officer of Cambridge, will assume the role of chief executive officer at Novell. He will replace Schmidt, who will continue to serve as chairman and chief strategist for Novell.

Though he orchestrated a brief turnaround at Novell since joining in April 1997, Schmidt was not able to stem the long-term erosion of Novell's market share to competitors such as Microsoft and the Linux distributors.

This provoked a rethink of the firm's strategy that has placed more emphasis on developing Internet services software and consulting.

With completion of the Cambridge Technology acquisition, consulting services will represent over one third of Novell's business, moving its revenue stream further away from its traditional reliance of its NetWare network operating system.

The change in senior management comes just before Novell's annual Brainshare conference, which starts on 18 March. At Brainshare Novell is expected to unveil NetWare 6.0, the next version of its network operating system software which is likely to add web access and portal features. The firm is also likely to provide details of an update to its eDirectory software, which is code-named Falcon. ®

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