Ransom Love out as Caldera CEO

Concentrating on UnitedLinux

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Internet Security Threat Report 2014

The new Caldera CEO is Darl McBride, who was a Novell exec from 1988 to 1996 and has run a succession of smaller companies since then. From the information in this press release it looks like one of McBride's primary skills is getting hold of investment capital, and Caldera can certainly use some of that. During a conference call interview, Love and McBride, along with Caldera CFO Robert Bench, spoke of how all this is going to affect Caldera, UnitedLinux, and Linux in general.

McBride used the word "exciting" at least half a dozen times, and the phrase "exciting opportunity" more than once. He said Caldera is "poised for interesting growth," which is certainly nice to hear. He spoke glowingly of both Linux in general and of UnitedLinux, and only slightly less glowingly of the traditional SCO Unix side of Caldera's business.

The one thing Caldera has that no other Linux vendor has or has ever had is its 16,000 resellers. Yes, Caldera is attuned to Unix now, but if the company can be swung toward Linux, as both Love and McBride believe it can, it represents a potent marketing force that can get Linux into small and medium-sized businesses in a way no other Linux company can match.

The key here is that these resellers need a product that has a price on it, so they can mark it up by some percentage formula and earn something on the difference, and this is why the UnitedLinux deal, which is oriented toward commercial Linux use, with fees attached, suddenly becomes important. If a reseller downloads a copy of Debian for free and marks it up 50% for resale, the net profit is zero. If that reseller tries to sell services based on Debian, the customer can legitimately say, "but I can get Debian for free, so who needs you?"

The service and support aspects come into play here, along with the method of sales. But neither McBride nor Love could say anything much about what would sell for how much. This is still being worked out. They can't even say what companies might end up being part of UnitedLinux. Love said he is contacting all kinds of companies in the Linux business, and all kinds of deals may be made; that they do not have a "one size fits all" philosophy here, that if Debian and Slackware people want to get involved in UnitedLinux's business focus, they might be welcome. But that's all up in the air right now, a maybe, a future possibility. Today's discussion was about two competitors in the commercialized Linux "sell it to the corporations" world; Red Hat and UnitedLinux.

SCO isn't going away tomorrow

McDonalds, a fast food purveyor, runs on SCO Unix, supported by Caldera. So does the Eckerd Drug chain. These and other major SCO users are unlikely to rip out their current systems, which work well and their in-house people understand intimately because they have years of experience with them, and replace them with Linux -- or Windows. So, say Love and McBride, Unix is still a big part of Caldera's business.

They claim Caldera hasn't lost any customers lately, but that the customers it has aren't spending much right now. Hey! The economy might pick up and they might open up those wallets. And if that takes a little while, things will still be cool; McBride and CFO Bob Bench both spoke of new capital coming into the company within the next few quarters.

New money! Yes!
The following two paragraphs, from the press release Caldera sent out earlier today, are key to the potential new capital infusion:

LINDON, Utah-June 27, 2002-Caldera International, Inc. (Nasdaq: CALD) today announced that it has agreed to purchase the shares of its common stock held by two significant shareholders, Tarantella, Inc. (Nasdaq: TTLA) and MTI Technology Corporation. The transactions involve the acquisition of approximately 4.4 million shares or approximately 31% of the issued and outstanding common stock of the Company. The aggregate purchase price for the shares of common stock is $4.1 million, or approximately $0.93 per share.

Both Tarantella, Inc. and MTI Technology Corporation had been seeking to sell the shares of common stock held by them in order to obtain liquidity for use in their own business. The shares have been included in a registration statement on Form S-3 filed by the Company and, consequently, could be sold at any time. The Company believes that the existence of such a significant percentage of the outstanding stock available for sale may have been adversely affecting the market for the Company's common stock and the Company's efforts to attract institutional interest in the Company. Consequently, the Company believes it is in the best interests of the Company and its shareholder to acquire these blocks of stock.

Okay, with those two large stockholders out of the way, their seats on Caldera's Board of Directors gone, and a new Caldera CEO in place -- one with a fine track record in obtaining investment capital, don't forget -- everybody and his brother and her sister is now going to want to invest in Caldera. That, at least, seems to be the hope.

What about Ransom Love?

We didn't sit in on the back-room dealings that led to Darl McBride becoming Caldera's new CEO and Ransom Love becoming head of Caldera's UnitedLinux operations. Love stressed several times today that he does not run UnitedLinux; that Caldera, TurboLinux, SuSE and Conectiva are co-equals in the venture; that what he offers here, personally, is time to work on UnitedLinux without being distracted by operating Caldera all day long. In effect, he is now the only full time UnitedLinux executive. The other members of its board are CEOs of Linux companies who have, presumably, plenty to do every day without further burdening themselves trying to make UnitedLinux work.

Note that both Love and McBride spent years at Novell. They are not strangers to each other. Presumably they have worked things like who is responsible for what out between themselves and are satisfied with the arrangement.

UnitedLinux, assuming it comes close to living up to the expectations its founding partners have for it, is certainly going to be a full-time job for someone, and it looks like Ransom Love is that someone. Not everybody in the Linux community loves him -- far from it -- but most of the people who seem to respect him are on the business side of things, and that's the UnitedLinux focus, so he might just be perfect in that role.

And all this means what?
"We'll have to wait and see," is the only honest answer. Caldera talks of getting new investment capital not today but over the next few quarters. UnitedLinux doesn't expect to have anything actually out there for sale by member companies for many months yet. There are many enthusiastic quotes on the UnitedLinux Web site from highly placed people at IBM, Borland, HP, Fujitsu Siemens, AMD, and a bunch of other interested companies. Whether all this enthusiasm can be turned into real, profitable sales is a question that probably will not be answerable this year.

But whatever the answer turns out to be, we're sure it will be "exciting."

© Newsforge.com. All rights reserved.

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