IT chiefs keen to deploy Linux in the datacentre but vetoed by risk-averse management colleagues received a lift last week after Novell said it would acquire Suse, and Red Hat announced plans to focus on enterprise customers.

Novell's $210m acquisition gives German Linux distributor Suse the scale to compete against publicly-traded Red Hat, and may encourage many companies that wanted to see another strong supplier of Linux after SCO pulled its Linux distribution as part of a high-profile legal suit.

Novell's status as a veteran of enterprise software and its strength in directory services and consulting may provide a more compelling alternative to Microsoft Windows and Active Directory.

Novell's move may also reduce uncertainty over Linux's future following the SCO lawsuit. And the deal will make Novell the only large organisation to offer Linux products for business desktops and servers.

"At the start of the year we sat down with customers to ask them what they wanted and Linux was a powerful response, but support and other issues were inhibitors," said Brian Green, Novell's head of enterprise solutions.

"We've been removing those inhibitors since and [buying Suse] gives us the complete stack. A bank with offices in Frankfurt and London needs global support. Organisations are looking for a single throat to throttle.

With Suse, Ximian and networking we can provide that." Novell acquired Ximian's Outlook-compatible Linux desktop software and dot-Net-compatible Mono project when it bought the company in August.

Although its presence has been fading for the past 10 years, Novell's NetWare still has a large rump of users that it will target for cross-selling. It is also building a large Linux services group based on the 2001 acquisition of Cambridge Technology Partners and it possesses complementary single sign-on, directory and management software. However, some Linux users doubted the deal would bring benefits. "I'd rather unification through proper standards than through wallets," wrote one web site poster.

Novell's acquisition of Suse will take it into direct confrontation with Red Hat, the profitable distributor that is the clear leader in north America. Red Hat last week stepped up its push for blue-chip custom by saying that it would withdraw its Red Hat Linux off-the-shelf product next spring, replacing it with an unsupported release called Fedora Core so it could focus most of its energies on its Enterprise Linux product.

"Firms want stuff that works, is stable and supported for a long time," said Red Hat's John Young. "If users want bleeding, leading edge they can use our community-supported Fedora."