Corel CEO: More growth and maybe acquisitions ahead

Corel has continued its growth as a private company, recovering from its lowest point during the tech downturn to the extent that it may yet make acquisitions and challenge a litigation-plagued Microsoft in some accounts, according to new CEO David Dobson.

In the hot seat barely seven days after a 20-year career at IBM, Dobson this week told silicon.com that while Corel may be below many users' radar these days, the company is focusing on making it eight consecutive quarters of profits and revenue growth.

The Canada-based vendor has "flourished as a private company", said Dobson. It doesn't have to report results like listed companies but he said that, while much smaller, its gross profit margin and research and development as a percentage of expenditure are similar to those at software giants.

The company will focus now on three main product areas: its CorelDraw graphics suite, Paint Shop and its desktop productivity software including WordPerfect, still arguably its best-known title. Signing more channel partners is on the cards, as are acquisitions, following on from the purchase of image manipulation outfit Jasc last October.

But the big idea right now is undercutting Microsoft and other big boys - such as the combined Adobe-Macromedia business - in targeted accounts.

"We want to be the most highly-valued alternative to the dominant [software vendor] in those segments," said Dobson.

By "highly-valued" he said he means software that can do the job but typically cost about half the amount of Microsoft offerings. He said he is not concerned by being undercut by open source applications, though he is in favour of that approach, which he calls "big, relevant and the way the world is going".

But growth might be nothing more than modest. Clive Longbottom, service director at analyst house Quocirca, said Corel may be relying a little too much on the Canadian government as a customer and that "WordPerfect hangs around their neck a little like an albatross".

However, he reckons that for small business and consumers Corel stands a chance when it comes to manipulation of highly graphical content.

"Most home users haven't heard of Quark and Corel can battle low-end Adobe software," he said.

Corel's Dobson said that WordPerfect remains strong in government and law and that deals such as the distribution of its desktop suite on Dell PCs shipped in the US mean the company will "convert hundreds of thousands on an annual basis".