SuSE Linux wins Dell server deal

Dell is expected to announce a partnership on Wednesday to offer Novell's SuSE Linux factory-installed on new servers, silicon.com's sister site CNET News.com has learned.

Dell has long offered market-leading Red Hat Linux as an operating system that can be installed in the computer maker's factories. But second-place SuSE has only been available as a special option for customers willing to pay for a customised system.

Now the computer maker is expected to elevate SuSE to Red Hat's level, sources familiar with the plan said.

Gartner analyst John Enck said: "It's great news for Novell. They now have all the top-tier players." Hewlett-Packard, IBM and Sun Microsystems -- which along with Dell dominate the server market -- already offer SuSE Linux installed on their servers.

Dell and Novell declined to comment for this story. However, executives from both companies have indicated the deal makes sense.

Richard Seibt, former SuSE's chief executive, said that in 2003, Dell and Novell started working together to help ensure their products worked well for mutual customers. And Dell executives said in interviews last week that offering SuSE Linux fulfils one of its major priorities: giving customers what they want.

Paul Gottsegen, vice-president of worldwide enterprise marketing at Dell, said "There's demand for SuSE Linux. It's out there. We sell a lot of Red Hat today, and to small and medium businesses we sell a certain amount of SuSE Linux. They both have large market, SuSE, particularly outside the United States."

Some of the groundwork for the alliance already has been paved. Dell and Novell signed a joint support agreement in January.

Stephen Shankland writes for CNET News.com.