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Sun Banks On Open Source For Its Survival

Posted by Soulskill on from the cutting-costs dept.

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.

21 of 211 comments (clear)

  1. No f**ing way. by Jane+Q.+Public · · Score: 5, Insightful

    If they want to stay afloat, they want the support of businesses. And from the position of a business owner, there is no way -- I mean NO WAY -- that I will accept advertising on my business documents. If somebody tried this STUPID move I would not only stop using their free product, I would refuse to use their commercial version. The idea is ASININE.

    Schwartz needs to stop believing in the Mel Brooks idea of "the Schwartz be with you". This is not a Mel Brooks movie.

    Sun needs market share. And they will never get it if this is the way they want to roll.

    1. Re:No f**ing way. by Firehed · · Score: 4, Insightful

      On or alongside? Obviously nobody would go for any free service that inserts ads INTO their business documents, but I think most people aren't especially bothered by the idea of having automated advertisements sitting next to what they're doing. It's never once bothered me in Gmail, and I honestly don't even know if they're present in GDocs. Neither is Sun's product of course, but Google seems to be doing quite well by, at it's core, providing free products to people.

      Something tells me that I'd find it significantly more distracting in OpenOffice, but that's probably more due to its interface being more than cluttered enough already. I'm sure part of it is that we're used to seeing ads in a browser window but nowhere else; I think the bigger issue is that giant stupid flashing banners that some people try using to monetize their freeware is hugely distracting to the point where it makes the product harder to use. OO is a respectable piece of competition for MSOffice for 99% of users, but after having been spoiled by the interface in Apple's $80 iWork08 suite, OO is never something I'd pay for given its paid competition. If they could revamp it with a clean interface and wanted to put a narrow strip of text ads at the top for unpaid users, I suppose that's an option.

      It's a bad position to be in - right now, OpenOffice is just burning money, it's not easily monetized through advertising (probably ineffective, lower acceptance, too small of an audience), and it probably wouldn't stand a chance of competing as paid software. Even if it was $10 at Best Buy and still free for download (identical versions, you're paying for the CD and distribution basically), people are so tuned into "Microsoft(R) Office[TM]" as their office suite that it would just get ignored in stores.

      MySQL at least seems to have a business model behind it, and one that's at least not losing money even if it's not immensely profitable (I have no idea what the numbers look like, but it can't be bringing in a ton or else they wouldn't be having these issues).

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    2. Re:No f**ing way. by NoobixCube · · Score: 4, Insightful

      Certainly not a smart move with Novell doing their repackage with Go-oo, and IBM basing Lotus off an earlier version. I can just see the users flocking in droves to either of those two suites now. This is Novell's chance to basically steal OpenOffice.org right out of Sun's hands. I'm not sure if Novell would handle it well, but they can hardly do worse than Sun, from what I've heard about their management of OO.o.

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    3. Re:No f**ing way. by Zaiff+Urgulbunger · · Score: 5, Insightful

      I don't _think_ they mean that; it wouldn't really work anyway as someone would fork the project. I _think_ they meant assisting companies that was to brand the office product, so if say Dell wanted to pre-load an office suite, they could install a Dell branded Star-Office or OOo.

      I could be wrong of course! But what you are suggesting is sooooo off-the-scale-dumb that really can't see that being what they meant!

    4. Re:No f**ing way. by Jah-Wren+Ryel · · Score: 5, Informative

      there is no way -- I mean NO WAY -- that I will accept advertising on my business documents.

      That is not even close to what Schwartz is planning. In his blog he compares how Sun gets paid for the optional bundling of the Google Search Bar with the Java installer. He then goes on to say that he plans on selling that kind of 'space' to other companies. He makes the point that Sun distributed 60 million java runtimes last MONTH - that is a lot of eyeballs to advertise to and that's what he as apparently monetized even further with microsoft in addition to or instead of google.

      As for similar bundling with OpenOffice, he's talking about including links (not just URLs) to services, similar to the Google searchbar - e.g. fax services, place kinkos for bulk printing, sign printing, cloud-based document storage, and database hosting, etc. It is the same thing we are used to with free software, the software is one a time cost so make it free once its paid for, but the individual, optional but useful services around the software have ongoing costs so use them as a source of income.

      You won't have to use any of the "cobranded" services, but if you want to, Sun will make it really, really easy for you to do so, and in return they get a cut of whatever you spend in the services.

      --
      When information is power, privacy is freedom.
    5. Re:No f**ing way. by pallmall1 · · Score: 4, Insightful

      ...but they can hardly do worse than Sun, from what I've heard about their management of OO.o.

      Sun's management of both OpenOffice and Java is lousy. They don't listen to their users -- the Java bug-tracking and voting system is bogus, and OpenOffice is "primitive".

      Read the threads linked to above to get an idea of Sun's utter cluelessness.

      --
      3 things about computers: they're alive, they're self-aware, and they hate your guts.
    6. Re:No f**ing way. by Greyfox · · Score: 4, Interesting
      It's pretty much the same inside the company. Sun used to be a company of engineers who made cool things. I don't get the feeling there was a market focus to that work, they just made cool things and the market just happened to want those cool things.

      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.

      --

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  2. daft by superskippy · · Score: 4, Insightful

    Much as I like open source, giving stuff away is really not what a business that need some cash needs right now.

  3. Long term prospects are not good for Sun by Anonymous Coward · · Score: 4, Insightful

    Suns long term (5-10 year) prospects just don't look good. Their core of products are all up against strong competition. The Sparc architecture is not significantly better than x86-64 to justify the additional cost and "non-standard" architecture to buyers, Solaris has some nice features but is up against both Linux & itself on x86-64 & IA32, where Linux continues to eat into the market share of traditional UNIX systems, and their x86-64 servers are commodity boxes which you can (& do) buy from someone else. Oh and of course Java and OpenOffice are established products that they have no way to capitalise on, essentially making them money-sinks on the balance sheet.

    Sun has to find a way to create a sustainable revenue stream, and it doesn't have much to work with.

    1. Re:Long term prospects are not good for Sun by QuantumG · · Score: 4, Interesting

      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.
    2. Re:Long term prospects are not good for Sun by superskippy · · Score: 4, Insightful
      No, that's IBM.

      I remember Sun adverts during the dot-com boom days that mocked IBM for having a huge range of stuff, where as Sun sold only one simple stack of stuff- theirs.

    3. Re:Long term prospects are not good for Sun by jcnnghm · · Score: 4, Informative

      Their FY2008 services revenue was $5.26B, storage revenue was $2.35B, and their computer systems revenue was $6.26B.

      While the services revenue is up 3% from FY 2007, storage revenue is only up 1.6%, and computer systems revenue is down about 3%.

      Given that 38% of their revenue is derived from services, and that services is their fastest growing growth sector, what makes you believe that services doesn't provide a revenue stream in practice?

      --
      You don't make the poor richer by making the rich poorer. - Winston Churchill
  4. They dropped $1 billion on MySQL by Phantom+Gremlin · · Score: 5, Interesting

    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.

    1. Re:They dropped $1 billion on MySQL by QuantumG · · Score: 4, Interesting

      MySQL's business model was to sell commercial licenses to people who were too legal risk adverse to use it without one.

      Sun, thankfully, has a completely different business model.

      They sell solutions. If they don't have to pay for licenses for MySQL they can offer solutions that include MySQL for cheaper than if they have to. Does that add up to a billion dollars? No idea.

      --
      How we know is more important than what we know.
    2. Re:They dropped $1 billion on MySQL by antifoidulus · · Score: 5, Interesting

      Actually the thing they sold(and still do sell) is a more "up to date" MySQL(including security fixes). The community version of mysql is always a little bit behind the Enterprise version in terms of bug fixes etc. They also sell support and probably engineering as well(don't know, haven't used that). We bought the MySQL enterprise edition where I work because we are being forced to be paranoid about security, and that includes always having the latest and greatest db software(whether or not MySQL is more or less secure than Postgres is another matter altogether)

      --
      Monstar L
  5. Re:Strategy by m50d · · Score: 5, Insightful

    Opensolaris is substantially more stable than Linux, along with having some unique features of its own. But more than anything it provides a platform that is all Sun's, complete with backwards compatibility going back over ten years even in the drivers (compare with linux where I struggle to compile modules from six months ago against new releases). You're right that hardware support is currently lacking, but there's still time for that to come - and architecturally Opensolaris has the potential to be a much better OS than Linux. It is not at all redundant.

    --
    I am trolling
  6. Message to Jonathan Schwartz by Morgaine · · Score: 4, Interesting

    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
  7. OpenSolaris Advantages by Ralish · · Score: 5, Informative

    OpenSolaris has all the advantages of Solaris 10 and more. So you're looking at things such as ZFS, DTrace, Containers, etc..., that are already in Solaris, as well as entirely new things not yet in Solaris, such as a much improved and more user friendly installation system.

    OpenSolaris is basically to Solaris what Fedora is to Red Hat Enterprise Linux. It's the cutting edge of Solaris development, with numerous Solaris devs contributing to it; it's an incubation ground. As the features mature and the bugs are ironed out, key features are then moved into Solaris, which is expected to be deployed on servers, mission critical systems, mainframes, and so on. Only recently did Solaris gain the ability to boot off a ZFS root fs for instance, but OpenSolaris has had that capability for quite some time.

    If you're interested in Solaris, OpenSolaris is the way to go, as you're less likely to be worried about some minor bugs and more interested in seeing everything it has to offer, including the cutting edge. I'd recommend you review the Solaris and OpenSolaris wikipedia pages for a good overview, which can link to more in-depth information on some of the specific features I mentioned above.

  8. Re:Jonothan Schwartz is safe, at least! by Anonymous Coward · · Score: 5, Interesting

    I work for Sun, and I suspect that you do, too. I'm an "individual contributor" and I have nothing to do with management. Nor do I own any Sun stock.

    Since I can't give you the Flamebait mod you deserve - since you should and do know better - I'll point out a couple of things for the benefit of those playing along at home.

    The cuts are not likely to come from "vital groups that provide support and engineering for major customer contracts". That would be suicidal; Schwartz, Green, and others at the upper levels have said as much. They are more likely to come from areas that are consistently failing to meet targets or provide cashflow. Software, support, and allied services currently stand the best chance of generating near-term revenue.

    And I'm sorry you're so upset that you won't be getting a pay rise this year. Guess what? I won't, either! But you don't see me bitching about it. WTF do you expect? "We're having a major downturn, here's your hefty salary increase"?

    If you want to keep your job, you'd better quit whingeing about how you're not getting rich as quickly as you might like and that you're not going to be able to expense quite so many lattÃs as you've been, quit worrying about what Jonathan Schwartz' ponytail is having for breakfast, and start doing something to generate value for the company and customers, because if you can't show that you are, you're going to walk.

    Here's a tip: If you're not doing something relating to software or support, get your arse over there and start doing something with a demonstrable benefit to the firm's bottom line ASAP.

  9. Re:You've never used a Sunfire x4100 x86_64 server by Kent+Recal · · Score: 5, Interesting

    Why is it that stupid people always put the blame on the vendor. There must be a pattern in there...
    We have over 50 xfires (4100s, 4200s, 4600s) in production, so I feel an obligation to comment on this drivel.

    1. If you really have mouthbreathers on your team that manage to break a server with the pen switch (of all things!) then you have much bigger problems to worry about. I see no difference between the pen-switch design that Sun uses and the stuff that you find on Supermicro or Dell Chassis everywhere. So better keep your "people" far away from those, too...
    2. I don't buy your "front panels falling off" story either. I have no idea what the hell you guys are doing to your servers (curling them through the datacenter?) but anyone who has worked with xfire hardware can attest that design and build are generally stellar, no less. Just by looking at the picture I can only wonder what part of the panel is coming off on your xfires, and how?
    3. I cannot comment on the video hardware problems that you were having, other than that we never had a problem with that. Our xfires are generally dead-on-arrival (yes, that happens with sun, too) or work flawlessly. So far we had only two 4200s make it through the burn-in but fail later on (flakey PSU, flimsy backplane respectively) which is a pretty good ratio when compared to our expiriences with supermicro hardware.
    4. Yes, PXE booting can be disabled for each individual NIC. Read the manual sometime?
    5. You're saying you have "over 50" xfires, yet you keep buying a raid controller that sucks? Honestly, if I were your boss...

    Sorry, either you're just making up shit here or you're the wrong guy for the job.

  10. More OpenOffice please by IGnatius+T+Foobar · · Score: 4, Insightful

    I don't know what portion of the OpenOffice developers work for Sun, but I'll bet it's a lot. And that's got to change. This is a worthwhile project -- without it, the Linux desktop basically ceases to exist (sorry KOffice fans, it's a great project, but it isn't even close to OpenOffice in terms of being usable as a true MS Office replacement).

    Red Hat? Novell? CANONICAL?? You've got to saturate this project with developers. Without it, desktop Linux is dead in the water. And yes, desktop Linux is real, today, despite what detractors say. Take that away and Linux slowly sinks in other areas too.

    And I agree with whoever suggested that they need to get the product out in front of more Joe Sixpak types. Press a bunch of CD's and hand them out like candy. It worked for AOL back in the day. We've got to get to a point where everyone's got "one of those OpenOffice CD's" lying around, so when they need to get a document together in the middle of the night and they don't have the time, inclination, or source media to get an MS Office install together, the little light bulb comes on over their head, they toss in the OpenOffice CD, and we have one more user.

    And of course the preload market needs to be saturated with OpenOffice. Every new PC needs to have a copy of OpenOffice preloaded. As the price of computers continues to come down, this could be the key to keeping that price point down. I'm sure Microsoft is really going to turn the screws on this one, but if a few PC manufacturers are bold enough to do it, this could be the pivotal moment for that.

    For 90% of the users out there, OpenOffice is MS Office's equal. It's time to really push push push to get it out in front of them.

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