In a perfect world, Alan Ashton, Bruce Bastian and Pete Peterson would still be running WordPerfect and its upward spiral would be unbroken.
Each new software release would cause rival Microsoft to skip a heartbeat and reviewers to heap praise on this homegrown Utah company.But the real world is much more harsh. WordPerfect, the software company once ruled by this triumvirate, now has its second owner in two years and faces a valiant struggle to regain its former glory.
There are many who believe Corel Corp., based in Ottawa, has the best shot at pulling off that feat. Corel announced Jan. 31 it will acquire Novell's business applications group, which includes WordPerfect as well as Quattro Pro, in a stock, royalty fee and cash transaction valued at between $186 million and $200 million.
"I believe they found the right buyer," said David Coursey, editor of PC Letter. "Corel has experience getting products to market at low cost."
Jeff Waxman, vice president of the Novell applications group, calls the Corel-WordPerfect match a "wonderful fit". Corel is No. 1 in its product niches, beating Micro-soft. It has a proven ability to sell software and spends generously to advertise its products.
"They do a phenomenal job of leveraging their marketing dollars and presence," Waxman said. "Nobody at Novell ever did that."
In the armchair analyzing about the failed marriage of Novell and WordPerfect, most talk centers on that central theme: Novell has never been in the business of selling software at the general consumer level.
"Selling was really the key," said Dan Lavin, a senior industry analyst with Dataquest, a market research company owned by the Gartner Group. "The Perfect-Office line needs a dedicated sales force to sell it."
Contrary to some recent media reports, Novell did not dump WordPerfect's sales force when it acquired the company in 1994 in a stock swap first valued at $1.4 billion but worth $855 million when completed. That had largely been already done in Word-Per-fect's cost-cutting measures, Waxman said.
"WordPerfect at the time was suffering financial pressures and the sales force was averaging very low productivity per person," Waxman said.
David Moon, former vice president of development at Word-Per-fect, said the company's management team pushed Novell to set up the division as an independent unit.
"We felt strongly about that, including having our own sales and marketing force," Moon said.
But Novell relied on a single sales force to sell both NetWare and WordPerfect products. That proved unworkable.
"Novell system products were being sold to people who weren't buyers of shrinkwrapped software," Waxman said.
There also was little crossover between sales of the two products. Customers bought "best of breed" products, rather than purchasing all the products offered through one company. The idea of combining networking with applications was premature.
In addition, the cultures of the two companies were different. Network software sales work with a 20 percent margin; desktop software application sales squeeze out single digit margins.
"It just didn't fit," Waxman said. "They were two totally different business models."
But there are other reasons WordPerfect's relationship with Novell soured. WordPerfect had fundamental problems coming into the union. "The seeds of the (problems) were in not properly answering marketplace needs in previous business cycles," Lavin said. WordPerfect had posted stellar performance every year since its beginning in 1979. But it made a crucial mistake when it banked on OS2 besting Windows as the de facto desktop operating system - a decision some attribute to Peterson, who in turn deflects it to a wider group of decisionmakers in control of the company at the time.
"This is a company that grew spectacularly but didn't move nimbly enough into the graphical world and they got caught," Lavin said.
Microsoft began to steamroll WordPerfect, which bungled again when it missed the shift to application suites.
WordPerfect also poured money into what was a well-regarded customer support system. The support paid dividends in customer loyalty but cost a bundle; it became a drain when WordPerfect's fortunes faltered.
By 1993, insiders say, WordPerfect spent every bit of the $700 million it had in sales. The company pursued a public stock offering to raise cash but backed off when its proposal got a lukewarm reception. "Underwriters were uncomfortable with the financial position of the company," Waxman said.
So WordPerfect courted Novell, hitching its fortune to that of its Utah County neighbor.
The timing of the merger proved ill-fated and foreshadowed difficulties to come: It occurred as applications developers were gearing up to work on products to run with Windows 95. Other companies have had Windows 95 products on the market for months; WordPerfect 7.0 for Windows 95 is finally scheduled to arrive in April.
Once the deal with Novell was consummated, WordPerfect employees got a much chillier reception than they expected.
"The fact that there was less support within Novell for the original merger than we thought was disappointing and led to distrust," Moon said.
Waxman acknowledges Novell made missteps, but he believes it did a good job overall moving WordPerfect forward.
"Had it not been for Novell, there would not have been a Perfect-Office (a suite of WordPerfect applications) and WordPerfect would have had a painful death," he said.
The best that insiders - from Novell and WordPerfect - can say now is that they all tried hard, that they, at times, stared down Microsoft.
"You can't forget how tough Microsoft is as a competitor, that Word became a much better product, that suites came along and that Microsoft cut prices," said Pete Peterson, who spent 12 years at WordPerfect, including 10 as executive vice president. "I think WordPerfect sold out because it didn't have the answers. Novell made it worse because it didn't have the answers either."
There is optimism that Corel knows what to do. "Corel, if anything stands for putting a lot of value in a box," Coursey said. "If (WordPerfect's) name and that value come together, it will be a win."