Comment Articles

Sun's plans...and how they could go wrong

George Colony CNET News

Published: 22 Sep 2004 10:55 BST

Where the potholes are
I'll say this for Sun: Its strategy is simple and to the point. You can criticise the company for many transgressions, but you can't fault it for lacking guts. If it goes down, it's going to go down taking very big swings. Schwartz and McNealy make a good team -- brains and will in a tight package.

The potential stumbles or counters that I can see are:

A fixation on engineering, not price. Dell will eat Sun for breakfast if the latter doesn't trade off engineering perfection for price. Sun has avoided this trap so far.

Betrayal by Microsoft. Redmond has been known on a few occasions to play its own self-interest first when it comes to deals. McNealy and Steve Ballmer, his counterpart at Microsoft, are high-emotion cases -- their trust and cooperation run the risk of wild up-and-down swings.

Linux becoming more than Red Hat. If IBM can keep Linux independent of Red Hat, Sun's target will vastly widen, thus blunting its strategy. And, of course, IBM could always acquire Red Hat, yielding instant credibility.

Engineering risks. The strategy depends on some breakthrough original engineering, such as Sun's chip multithreading project. If Sun can't deliver on the big promises, it will suffer.

I've hung around with many tech zombies in the past, from Wang Laboratories to Prime Computer to Digital Equipment. When I stare into the eyes of the Sun management team, I still see life; this team doesn't look like it's ready to give up or stop trying to compete. Given the strategy and management, I believe that there is a good chance that Sun will be around for a strong third act.