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Sun Banks On Open Source For Its Survival
CWmike writes "In moving to cut its current workforce by between 15% and 18% today, Sun is trying to stay ahead of a falling knife. And today's announcement made it clear that Sun officials are banking on the company's open-source strategy to help it pull through. A cut of up to 6,000 employees at Sun will hurt, but CEO Jonathan Schwartz contends users will be more inclined to try open-source products such as MySQL, OpenSolaris and Sun's GlassFish application server during a time of economic stress."
Reader Barence also pointed out that Sun will begin to auction "branding space" in OpenOffice.
I'm not a software guy, so maybe I'm missing something. But paying $1 billion for MySQL (less than 1 year ago!) didn't make a whole lot of sense to me. Wasn't a lot of the code GPL?
As of yesterday the stock market values the equity at $3 billion. And actually values the company at only $1.6 billion (they have $2.6 billion in cash but also have $1.3 billion in debt).
Maybe a company that throws money around so freely deserves to go out of business. Even in 2008, a billion US dollars is still a *lot* of money.
They're a systems integration company. They don't need to sell "invented here" to be profitable.
Sun will sell you whatever you want. Invented by Sun, or not.
They sell solutions, not widgets.
How we know is more important than what we know.
Does Star Office having plans on "branding"? I wouldn't mind paying to turn this off, but if Sun forces me to look at McDonalds & Starbucks logos all day - forget it.
That looks great on paper, but doesn't provide a significant revenue stream in practice. The last time I saw anyone buy a "solution" from Sun was, well, never.
From my perspective (I've used and bought Suns for decades), Sun is heading full tilt down a path towards the cliff edge. What they're doing is 100% wrong.
Their interest in open source is fine, but it's not a good strategy for business profits unless they want to become another RedHat providing Linux services and support --- a role in which they would be coming up from behind very slowly. It's a role for which they're not cut out, because their reputation in the open source world is marginal at best because they've always been half-hearted about it.
Sun needs to stop thinking of open source as a business strategy, because for them it's merely what's referred to as a hygiene factor in social sciences --- it's not a benefit when it's exercised, but it's a severe demerit when it's not exercised. In other words, yes, be fully open with software, but not because it's a source of profits, but because you'll be shunned without it.
For profits, capitalize on what you have: awesome hardware and competent Professional Services. Invest more in your CPU division with its great Niagara processors, so that when Intel is offering 16-core CPUs and talking about 64, you can be offering 256-core and talking about 4096. Take on nVidia and AMD on the SIMD front, so that while they're toying with noddy graphics cards for GPGPU, you can offer 64k SIMD stream processors far more tightly coupled to your host cores.
We've recently entered the Age of Multicore, and you (Sun) have a good reputation in that area, and you know how to build good hardware (nobody has ever marked you down for that). Why not capitalize on your existing skills, resources and reputation in this area, instead of chasing rainbows?
"The question of whether machines can think is no more interesting than [] whether submarines can swim" - Dijkstra
Sun is both laying off 6,000 people (which will significantly impact vital groups that provide support and engineering for major customer contracts who are already short staffed) AND freezing all salary raises for FY09.
Thank god this is coming after Schwartz already got his $11,000,000 bonus for the reverse stock split that saw Sun lose 85% of its value in just over a year. Thank GOD Schwartz still gets his $60,000 per year stipend for his chauffer. Thank GOD Schwartz has nothing to worry about and can address every problem with more layoffs just as Sun has continued to do since 2001.
Sun has laid off more people since 2001 than currently work at the company. The problem is, they NEED those people and wind up hiring a lot of them back. So the layoffs are constantly necessary to appease wallstreet.
Sun will fire 6,000 people. They will take a $700m charge for this. That will screw up their numbers (like it does every quarter and year) which will further anger wallstreet and devalue Sun in their eyes. And they'll hire a lot of people back in that time. So to appease wallstreet for the negative numbers partially caused by the charge-off for layoff costs, they'll lay off more people. And get back to the number of employees they had just prior to the last layoff. And then they'll take another charge. And then repeat the cycle.
They've done this for most of a decade. It is nothing new.
BUT THANK GOD JONOTHAN SCHWARTZ WILL STILL AFFORD SHAMPOO FOR HIS PONYTAIL AND A CHAUFFER FOR HIS DAILY COMMUTE!
What a piece of crap these things are. There are two big problems:
1. Build quality. They have a small power switch and LED board mounted near the left front that is activated by a pen. Invariably, people press it too hard and destroy the switch, which results in a nonbooting server. But the boards are service parts (they probably are worth 10 or 15 bucks tops) and cannot be purchased in bulk. I mean, i'd be ok with this if we could buy 20 or 50 of them and keep them on hand. They're not so hard to replace. But WTF. I mean, people with little physical strength can render the server inoperable.
The front panels fall off regularly, the optical drive bezels might as well be scotch taped on. Video hardware is chancy and may not work in some cases. I have over 50 of these things so I know whereof I speak, bought in several waves. I mean, if this was Dell i'd understand, their stuff is cheap. But this server is not cheap!
Anyway Sun warranty service is also pretty slow to respond to us, though they do eventually fix the problems, at the cost of devices being out of action for significant stretches of time.
2. Poor integration and poor choices for third party parts. For instance, PXE booting on all four included NICs must execute during bootup. No disabling this is possible. Dell used to do this shit too, but at least Dell was cheap. The x4100 is expensive for an x86 server of its meager specifications.
In addition, the RAID controller is an utter piece of garbage. Most RAID controllers - think Dell PERCs, or HP/Compaq Smart controllers, will treat the disk array as a set of disks that can be transported between servers as a unit, and will be read by the controller as the same unit regardless of the system it is put in. Not so the Sun DPT controller. It apparently stores the RAID config in flash on the card or something, so when you move the disks between systems it basically refuses to recognize the array as a unit. You pretty much have to perform a recovery on the first disk of a RAID 1 set and then reintegrate the second drive, which is a scary prospect when you have data you care about and time is of the essence.
Why DPT of all vendors, anyway? And why did DPT screw the pooch so bad with this one? They have perfectly workable RAID controllers that do not have this flaw. Oh and the controller is dog slow too.
Anyway, they got the contract for a particular large government agency's servers for a particularly large program, so that's why I have the things and they keep getting airdropped on me. I'd like to shitcan them all but I have to make the ones that aren't broken at any given time work until they finally get EOL'd. Hopefully soon.
But yeah, i'll never even look at Sun gear again.
HBI's Law: Frequency of calling others Nazis is directly correlated with the likelihood of the accuser being Communist.
Ac cause I'm modding
There are many different kinds of branding. Schwartz didn't specify (in his blog) what he meant by 'branding', so don't jump the gun.
I seriously doubt that an office doc is going to have 'Sponsored by Dell' either as a watermark or a footnote on a printed page.
What I do see if that every time OO3.x starts up, you'll see 'OO3.x Sponsored by Dell' and their logo. Maybe even a splash screen before a saved document opens. You may even see a Dell logo on a toolbar, like FF or IE.
That's acceptable use of branding.
I think most people aren't especially bothered by the idea of having automated advertisements sitting next to what they're doing.
Except when you have a mobile dial-up, and you get 3 Gb a month. Then, anything that tries to download anything I didn't tell it to gets deleted, fast. Like MSN Messenger.
Couple of data points:
1. My kids go to school in the Bay Area. Both have an impressive wardrobe of Sun-logo'd t-shirts (the designs are much better that your average "slap-a-logo-on-a-white-T"). While I'm not complaining, why is Sun clothing my children while laying off 5,000 staff?
2. I've been in the computer business for ~25 years. I've done work with Sun in the past (~15 years ago). I can tell you what business Microsoft is in. I can tell you what business HP is in. Ditto Oracle. Heck I even think I could tell you what business IBM is in these days. I have *no* idea what business Sun is in. Oh I know they own some Open Source apps and once upon a time they made computers around the SPARC processor - but what do they do now? How do they intend to make money and return a profit for their shareholders?
Rich people are eccentric. Poor people are strange. Me, I'd be happy with odd.
Somewhere along the line the engineers making cool things were replaced by "Process Black-Belts" who spend all their time talking about "six sigma" and making engineers fill out reams of paperwork to make the smallest change to an existing product, never-mind innovating on something new and cool that the market might want.
Well now Google is the one in the industry making cool things and Sun is competing against IBM with its products. IBM doesn't waste time with Six-Sigma process people. They focus on the customer and build what the customer wants. When you're competing against IBM the problem is that your customers realize that IBM is most likely still going to be here in 20 years and your company most likely is not.
Sun could reverse this process by starting to make cool things again and trusting that if they build it the market will come. I don't really see that happening, though. They'll probably fire all their engineers and keep all their process people, which is exactly the reverse of what they should be doing.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
Also, don't forget the egos. These are the ones in the in the ivory towers. If there is a good project amongst engineers elsewhere in the company, they will ensure that it gets a Design Review at Code Review time such that the reviewers get to redo the project, with bells and whistles, and take all the credit.
It helps if the original project didn't start in the USA, because Sun will always protect American jobs over everyone else's.
Opensolaris is substantially more stable than Linux
Bullshit. The last two times I tried opensolaris, the installation was catastrophically destroyed the first time that I upgraded it. System wouldn't even fucking boot.
It might be stable if you never touch it, but so is linux, so the difference can't be that great. Besides, an admin is expected to, at the very least, perform security upgrades on a regular basis. Their packaging system is *beyond* broken and smf is a horrible piece of trash that makes you long for the simplicity of rc.d scripts.
Sun does appear to be reversing the process - this is how the new FishWorks product was developed. They got some smart people, put them in a room together and left them to it, like a startup inside the company.
Now lets see if they can replicate that.