After a five-year moratorium on buying anything from Sun Microsystems Inc., CIO Moti Vyas is trying out Sun's X4100 and V40z servers. "They're pretty cool, literally," said Vyas, who oversees IT at the sprawling Viejas Casino in Alpine, Calif.
Power consumption and cooling are major concerns for Vyas. "Sun introduced the right hardware at the right time for us." Indeed, when the casino's new data centers are built, Vyas is "seriously thinking" of buying 30 to 50 of Sun's X4200s, particularly if some problems with Windows compatibility are resolved. "My senior engineers tell me that if Sun could take care of those issues, these boxes would be flying off the shelf like iPods!"
Mike Hugos, a former CIO and author of Building the Real Time Enterprise: An Executive Briefing, was more blunt about Sun's place in the IT universe. "In the 80s and 90s, Sun was synonymous with cool computing and leading-edge ideas in the IT business. Sun is now almost irrelevant outside of a few niche markets," Hugo said in an e-mail. In his view, the company's biggest blunder in recent years was not jumping on the Linux bandwagon. "Instead they tried to hold out with Solaris and continued to lose opportunities to grow new business. Now there are plenty of good makers of servers. Why would I even consider looking at Sun when I have IBM, Dell and HP to choose from?" he said.
Vyas and Hugo's comments echoed those from many technology executives polled this week in the wake of Sun's big news that co-founder Scott McNealy was ceding day-to-day operations to Jonathan Schwartz, president and chief operating officer.
The perception that Sun's best days are behind it may be the company's biggest challenge going forward, said Daryl Plummer, an analyst at Gartner Inc. in Stamford, Conn. That, and the widespread impression that Sun is not sending customers a clear message about where it's going.
"The common complaint you hear is that Sun is a hardware company in a world that needs services. In fact, Sun has taken positive steps, by offering customers servers at reduced costs and new configurations, by working with large service providers, by offering free software and their try-and-buy model. They are acting like a services company. They need to convince people there is something different about Sun, so the perception does not become the reality," Plummer said.
Plummer pointed out that Schwartz has changed management, changed the sales force and changed the way people are compensated. "Now he has to turn what they're doing into money. Sun's got to convince people to write checks. And the way you do that is to rebuild trust in the company," Plummer said.
Analyst Frank Gillette at Forrester Research Inc. in Cambridge, Mass., had three suggestions for Sun. First, he said, Sun needs to do a better job at articulating and persuading the marketplace that its systems approach -- engineering the software and hardware together -- is worth doing.
"Second, they have to accelerate the conversion of their software business to a business based on ether services, using free software, which they are in the process of doing now, although they don't articulate it that way. And third, they need to rebuild the sales engine to actually compete in the field and win sales," Gillette said. "They are still figuring out how to go from a technology-based sales force to a service-relationship-based sales force."
Gene Guertin, CIO at Smart Document Solutions LLC in Alpharetta, Ga., said Sun is still focused on the data center and IT development, instead of delivered business solutions. "At least I don't know how the products do that. If I talk with Microsoft, IBM, EMC, they all tell me what business solutions, hardware and software, they and their channel partners have to help me with my business. Just going head to head with equipment providers will not provide Sun with a major growth initiative," Guertin said.
Greg Schueman, CIO at Employers Direct Insurance Co. in Thousand Oaks, Calif., said he's impressed with Sun's new AMB Operton line of servers, but the company has to work on making portions of its software product line more competitive.
"My advice would be to decide whether they can be competitive with the top three in the market with a given product, and if not get rid of the offering or partner with an open source community, like Apache," Schueman said. "For example, it doesn't make sense to have a Sun App Server when Sun could ultimately adopt and build on top of Apache Geronimo."
That criticism certainly rings true for Fernando Gonzalez, CIO at San Francisco-based garment manufacturing company Byer California. "Sun does not have a good message for what type of company they want to be and who they are going to compete with. Are they a hardware company, a software company, a services company? What do they think they're best at?" Gonzalez said.
Praising McNealy as a "good evangelist for the importance of IT," Gonzalez said the message to Sun customers became muddled. And McNealy's good advice, such as urging companies to consider the cost of exiting a technology as well as the cost of getting into it, worked to Sun's disadvantage. "Where it hurt Sun was that moving from their servers to Intel-based servers as Web engines was easy, because the barrier to exiting from Sun was very low. So we moved."
Likewise, Sun created StarOffice to compete with Microsoft Office. "One of the weaknesses in the Microsoft product was that you could not convert Word documents on very old releases, but you could read them with Star Office. So you would buy Star Office for $79, convert files into it, then save them in a newer version of Word that StarOffice could do, then reopen them with MS Word. We were using Star Office only as conversion tool. No one would stay in StarOffice and work."
Not all technology officers, however, are pessimistic.
Tsvi Gal, chief technology officer at Deutsche Bank Asset Management, said that while Sun "still has a long way to go to recover" he's been impressed with the company's recent ability to read the market and act swiftly. "The 'Free Solaris' and the fact that Solaris x86 works very well puts them back in the competition," Gal said.
Let us know what you think about the story; e-mail: Linda Tucci, Senior News Writer