The Decline and Fall of Sun
However, in time Sun lost billions of dollars
during a steady decline that continued for more than a decade after the
dotcom boom collapsed in 2000-2001. During the boom Sun had been able
to sell its servers and workstations for whatever the market would
bear; $20,000 for a workstation or high-performance server were normal
After the dotcom bust, lightly used Sun equipment became a glut in the market, and the company found itself getting squeezed on the high end by IBM equipment and on the low end by smaller, cheaper Intel-powered servers and storage arrays from Hewlett-Packard, Dell and many others.
When he fielded the inevitable question about "what happened," Zander opted not to talk about it, saying instead that "we did what we did; we had some great successes and made some mistakes. We know that. But let's not go there now. This is a celebration of sorts tonight and let's leave it at that."
Zander, who served as CEO of Sun (1998-2002) and of Motorola (2003-2008), asked most of the questions and offered some cogent thoughts on the development of IT, then and now. And McNealy, never one to be at a loss for a quip or joke, came through as expected with a number of funny-and sometimes surprising-lines.
For example, McNealy says Sun can take credit for developing the concept and fundamental elements of cloud computing.
"We invented all the elements of cloud computing at Sun. Remember, our tagline was 'The network is the computer.' We came up with TCP/IP, the first NFS (network file system), and Java. All those things are the basis for cloud computing today and they all still work really well."
"Ken Olsen (who died on Feb. 6), who is one of the all-time thought leaders in IT, was co-founder of Digital Equipment Corporation (DEC). When DEC launched (in 1957), they called themselves 'distributed computing,' which was the first phrase for cloud computing."
McNealy on open source development: "We invented open source at Sun, taking the first open source operating system (Sun co-founder Bill Joy's BSD Unix) out of Berkeley. We open-sourced TCP/IP, Java-a long list of really important IT building blocks. Other companies, like Red Hat, might have monetized it better."
McNealy also conceded that one of his biggest mistakes was that Sun waited too long to move to the Intel processor architecture for its servers.