"India Must Rein in (Wage) Inflation"

Novell, a global leader in enterprise solutions, is scaling up operations at its development centre in Bangalore to develop core technologies, products and solutions. On a recent visit to India, Ronald W. Hovsepian, President & CEO of Novell, spoke to BT's K.R. Balasubramanyam about the company's strategy to consolidate its position in its core business segment.

Has the business dynamics changed for you after the Oracle buyout of Sun Microsystems?
Oh, yes. A lot of customers want more choice in the market now and that is working in our favour. I see Sun customers' migration, a very big migration, to SUSE Linux platform.

You have been talking about acquisitions to drive growth.
We want to buy companies that advance our strategic position. We are focussed on two markets—identity and security market and systems management market. We are sitting on just under a billion dollars of cash. And this is where we look to deploy our cash.

What are your future growth plans here?
India is a very important market to us. Our headcount here has increased by 70 per cent in three years. We have got 45 per cent of our development resource housed here in Bangalore. India has been a great labour arbitrage. As long as inflation does not run too high and drive up costs, you have got an edge over competition. So, tackling inflation is very important.