PROVO, UTAH - Novell is reportedly close to pulling the plug on its less-than-2-year-old caching spinoff Volera.

Sources close to Volera and Novell tell Network World that work is under way to combine Volera's managed and secure content-distribution capabilities into Novell's BorderManager. The Internet access and authentication product is just one piece of Nsure, a suite of integrated offerings that Novell says will let businesses govern what users can access on corporate networks.

According to sources, "the deal is as good as done" and Volera will cease to exist as a separate entity sometime in the next few months.

However, a Novell spokesman says that development on Volera's Excelerator product is continuing independent of work on BorderManager. Next week, Volera will start a beta program for Excelerator on the Linux platform and has 19 companies lined up to participate, he says.

During the company's third-quarter earnings call in August, CEO Jack Messman said Novell was "re-evaluating [its] strategy at Volera." Further, in its third-quarter filing with the Securities and Exchange Commission (SEC), Novell says Volera sales have been flat and are expected to remain so through the remainder of the year.

"Volera's performance has not met the growth expectations of the company . . . " the filing states.

Volera has yet to turn a profit since it was spun off in February 2001 to take advantage of what Novell saw as a hot market for its content networking products, particularly its Internet Caching System. The trouble was Novell spun off the company at a time when the caching market already was starting to take a hit, analysts say.

"Novell was an early entrant into caching with great technology, but didn't really succeed because they didn't solve the problem of how to get to [customers] other than their installed NetWare base," says Peter Christy, an analyst with NetsEdge Research. "Volera could have addressed that problem, but . . . they were spun out too late."

By the beginning of 2001, the once high-flying caching firms already were being grounded by the demise of their dot-com customer base and the slowed spending of service providers. CacheFlow announced in February 2001, as Novell launched its joint caching venture with Nortel and Accenture, that third-quarter sales would be below expectations, and laid off half its workforce in a restructuring effort.