"Linux is a $500 million market and not $8 billion as it will be in ten years from now," he said. "We have grown Linux at the expense of Unix consolidation and we have not taken enough from Microsoft."

"Look at a company like Peugeot - we are replacing Windows with 20,000 SUSE Linux desktops and 2500 servers," he said, adding market disillusion over Windows Vista will aid Novell's cause.

"We are going to attack Vista [and] we are excited about the strength of Linux compared to the competition. Look at Vista, it has been a five year development cycle. The beauty of the open source development process is the flexibility."

Hovsepian is also pleased with the ISV support for Novell's fledgling operating systems, and said IBM's Linux port of Lotus Notes helped win the Peugeot contract.

The company is also continuing to contribute code to open source communities, including the $17 million worth it spent on AppArmor. And by leveraging and contributing open source code, Hovsepian is keen to keep Novell's R&D budget to a fraction of what it would cost to engineer software from the bare metal up.