From Leader to Also-Ran

This Business Week piece on the decline and [expected] fall of Sun covers much of the trouble with the embattled creator of Java, but it misses the most basic point: Sun has bet the farm that people will pay a premium for Solaris, one of the last surviving proprietary Unixes.

This used to be true; in the late 90s, my old firm worked almost exclusively on Sun hardware running Solaris; we delivered that platform to an awful lot of happy customers because it was the best possible choice. Windows, then as now, just wasn’t up to the task, and the other Unixes — HP/UX, IBM’s Aix, etc. — weren’t as popular. Then something weird happened: Linux. Within a few years, it was awfully hard to find a reason to pay for an expensive, proprietary server when Linux on commodity hardware did the job just as well.

The server choice conversation these days pretty much starts and ends with “Windows or Linux?” Unless there’s some other (usually political) reason, though, the right choice is almost always Linux for sheer TCO reasons. You can run on cheaper hardware than an XP system, and you have access to the whole of the Open Source pantheon of software. To choose an expensive Sun machine running a closed OS is to spend even more money than the Windows system requires, which throws far more money at the problem than is reasonable in most contexts.

I won’t pretend that there aren’t some applications that could benefit from Sun hardware, but remember that Google runs on commodity hardware, and their needs probably exceed most. Even if you’re not the world’s index, when you can do 3MM hits a day and support 150,000 users with two commodity boxes running Linux, Apache, and Postgres (like these guys), why exactly would we want to buy Sun machines and software?

The BW piece only mentions this obliquely, but at the end of the day I think it’s the biggest problem facing Sun, and they’re doing little to face it. They sell high-end servers running proprietary Unix, and pretty much nobody else is making money doing that anymore. Their other lines of business aren’t significant on the bottom line. Most folks see that (which helps explain their market position, stock price, and the ongoing departure of key execs). Except, apparently, Sun CEO Scott McNealy.

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