Sun Sees New Day after Microsoft Deal

 
 
By Steve Gillmor  |  Posted 2004-04-19
 
 
 

The Sun-Microsoft alliance has been broadly perceived as an attack on Linux and the bailout of a weakened antagonist to preserve the illusion of competition. Certainly the deal is all about intellectual property, with licensing money flowing between Redmond and Menlo Park.

The cash transfers recall the much lower number of dollars ($150 million) that accompanied the Apple bearhug in 1997 when Microsoft needed the continued existence of at least one other operating system after OS/2s demise.

But lets turn the telescope around and look at the deal from the other end. With an extra $2 billion in the bank, a leaner and meaner work force, and a new software-focused heir apparent in Jonathan Schwartz, Sun emerges from its post-bubble cocoon in good shape.

Click here to read Steve Gillmors interview with Jonathan Schwartz.

Indeed, Schwartzs Java Desktop and Enterprise systems strategies have already borne fruit. Suns per-citizen pricing for governments and noises about free hardware (bundled with developer software) may well have prodded Microsofts decision to cut Windows XP prices in Malaysia to match the rival Linux/Open Office bundle.

Click here to read another conversation between Schwartz and Gillmor.

And I dont think it was coincidental that IBM began to make noises about Sun open-sourcing Java when faced with $100-per-employee price for the JES stack. When asked about IBMs "offer" a few days before the settlement, then-software-boss John Loiacono jokingly said it would happen when IBM gave WebSphere and DB2 to the community.

In Microsofts case, caving on price in Asia also puts pressure on other pricing issues, most notably its Software Assurance model. And in addition to undercutting WebSphere and DB2 prices, JES also undermines IBM Global Services revenue by offering an integrated, prequalified stack.

Steve Ballmer may say, as he did to eWEEK editors, theres nothing in the agreement about open source. "This is all about Solaris," Ballmer said, adding, "We dont license our intellectual property under that framework because we need to get paid for it." But Schwartz said: "There is nothing that precludes us from taking the protocols we license from Microsoft and incorporating them into our products. Now, where those products run is up to Sun." JDS, of course, runs on Linux but not (yet) on Solaris.

Read the full interview with Steve Ballmer here.

Schwartz ticked off the list of non-open-source technologies that add value to the community: RealNetworks RealPlayer, Macromedias Flash and Adobes Acrobat. And then theres Suns JVM, which ships on 60 percent of new PCs. It has auto-update capabilities that can install patches, updates and applications that route information, data and services.

The day of the settlement, Scott McNealy announced Schwartzs promotion, noting, "Jonathan has demonstrated a passion for disruptive innovations that unleash new customer value, creating new opportunities for Sun and altering the IT landscape."

No kidding.

Contributing Editor Steve Gillmor is editor of eWEEK.coms Messaging and Collaboration Center. Gillmor can be reached at steve_gillmor@ziffdavis.com.

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