Will Sun Get a New Lease on Life?
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However, the Oracle buyout gives the Sun brand at least a chance for a new
lease on life under the Oracle umbrella. If Oracle is smart, it will retain the
Sun brand and market identity while continuing to invest in server and storage
research and development.
Sun still has many loyal customers. Oracle has been one of the most loyal.
The two companies grew up together in Silicon Valley,
and Oracle has run his own IT centers mostly on Sun equipment. It hardly makes
sense that Oracle bought Sun so it could slap an Oracle logo on Sun's boxes.
But stranger things have happened.
This isn't Oracle's first foray into the hardware business. There are some
who may yet recall that Oracle was one of the chief proponents of the "network
computer," a stripped-down computer without its own data storage disk drive
that would connect to centralized servers and databases to access applications
and data. Oracle actually trademarked the term "network computer division"
and in the mid-1990s promoted an alliance of manufacturers, including Sun, to
build and sell the devices.
Now Oracle is in the hardware business with both feet for better or worse.
It gets a chance to show whether or not it can build an integrated hardware and
software business on the scale of an HP or an IBM.
That has to be an important factor to Ellison, who will turn 65 in August, an
age when most corporate chief executives head off to retirement, though not
necessarily so in his case. But he has to be thinking about his legacy. And the
massive buying binge the company has engaged in for the past six years was
intended to give Oracle the power and resources to stay vigorous perhaps for
decades to come-long after he has left the company he founded.
The challenge for Oracle will be to keep Sun from becoming a drain on his
own cash reserves. Oracle must wring out all the redundancies and expenses from
Sun operations. Oracle has shown time and again that it can do just that with
ruthless efficiency. But it also much restore the competitive edge of Sun
products, something that was lost with Sun's stubborn refusal to use Intel x86
processors in its servers and its adherence to the SPARC processor platform
long after it had ceased to be a market advantage for the company.
But most of all, Oracle has to prove to all those other loyal Sun customers
that there is an upgrade path for all the Sun hardware and software they have
invested in over the years.
John Pallatto is eWEEK.com's Managing Editor News/West Coast. He directs eWEEK's news coverage in Silicon Valley and throughout the West Coast region. He has more than 35 years of experience as a professional journalist, which began as a report with the Hartford Courant daily newspaper in Connecticut. He was also a member of the founding staff of PC Week in March 1984. Pallatto was PC Week's West Coast bureau chief, a senior editor at Ziff Davis' Internet Computing magazine and the West Coast bureau chief at Internet World magazine.
