May 8, 1997 7:45 AM PDT

Cisco-Microsoft deal sorted out

| Interop LAS VEGAS--Did the market for directory services in operating systems just get more complicated?

Cisco Systems and Microsoft said yesterday that they will join forces to unify the way networks provide access and offer services to customers.

But the deal could put a serious kink in Novell's plan to make its Novell Directory Services (NDS) an industry standard.

Cisco Systems, the giant of the networking industry, and Microsoft, the operating system kingpin, announced an agreement at Spring Networld+Interop 97 for Cisco to license the Redmond, Washington-based company's next-generation Active Directory, a key component of Windows NT Server 5.0, the much-anticipated next version of the company's operating system for workgroups and corporate networks.

Both companies insist that their work will result in the standard directory technology for the industry.

"[The alliance] is very impressive," said Jamie Lewis, president of the Burton Group consultancy. "If they follow through on the promise, customers will be very happy."

Lewis said Microsoft and Cisco shared many common customers and could solve the current confused state of directory services, where various systems do not necessarily integrate well together. "The pressure on them to solve those problems is high," he noted.

A directory provides a central repository for all network resources--including systems and applications--for managers to use when configuring a system. Active Directory is part of Microsoft's play to make its Windows NT a heavier-duty operating system for large networks, similar to Unix.

A partnership with Cisco in this area can help Microsoft because most of Cisco's market is in large enterprise networks, telecommunications carriers, and Internet service providers. Those markets still run largely on Unix variants. A directory linked to Cisco's Internetworking Operating System (IOS) could potentially open the door for a more unified approach to directory services, an area now populated by several firms, including Novell and Netscape Communications.

As part of the agreement, Cisco is taking Active Directory, integrating it into IOS, and porting it to various Unix operating systems. This could dampen Novell's recent moves to make its Directory Services the most widely used platform in the industry.

Novell already claims that NDS is the "de facto" standard in the industry and finds hype over Active Directory frustrating, as they must respond to questions about a technology that is not yet on the market.

But the agreement could alter the landscape for network services because IOS is an umbrella name for a huge set of protocol support and service functions, such as security. For example, a directory-enabled IOS package could pose a serious threat to Novell's bundle of Border Services, the current term for an unnamed product that will ship in August and deliver security features and proxy caching between public and private networks.

For Cisco, there are risks. Active Directory will be a first-generation feature of Windows NT 5.0, while competitors like Novell have been shipping the technology for three years.

The Provo, Utah-based Novell doesn't believe that the duo can deliver, especially given that Active Directory will not see the light of day in shipping until next year. Michael Simpson, director of marketing for Novell's Internet Infrastructure division, called the Microsoft-Cisco partnership a "public statement of desperation" by the Redmondians to catch up to NDS.

"If they want to stall NDS's momentum, they have to get a big player with a large presence in the market," Simpson said. "Basically, they went to the only company that hasn't announced a relationship with Novell."

The Novell executive also noted that in recent months Cisco has named Microsoft as one of its competitors. Conversely, Simpson said, as Microsoft has focused more on networking in its software, it has seen Cisco and IOS as potential adversaries. "That's a foundation for a wonderful partnership," he noted wryly.

Novell has announced a series of partnerships in recent months, including deals with most major Unix operating system firms to integrate and offer Directory Services with every Unix server sold from the likes of Hewlett-Packard and Sun Microsystems. Novell also plans to license NDS to Intel-based server companies running Windows NT when an NDS version ships this year for the popular Microsoft platform. A bundling agreement with Fujitsu, a huge player in Asia, was announced yesterday.

But Windows NT is showing more evidence of growing strength; Microsoft claims that more than 1 million copies of version 4.0 will be sold by the end of May. Furthermore, the company announced plans to offer enterprise and small-business versions of BackOffice, the company's server application bundle.

"We are expanding the family in multiple ways," said Jim Allchin, a senior vice president at Microsoft. This can only mean more markets for Active Directory technology once it makes an appearance.

Ed Kozel, senior vice president at Cisco, said his company's vision has always been to create single log-on technology for users. "Microsoft is the only vendor who can provide us with what we really want to achieve," Kozel said.

Windows NT Server 5.0 with Active Directory will enter beta later this year, with a rollout planned sometime in the first half of next year. Integration of IOS will arrive in conjunction with the 5.0 release, and versions for Unix operating systems will follow within 90 days.

 

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