Sun Gets Some Some Much Needed Good News

Sun Microsystems, which has made data storage one of its top three priorities, has been wrestling with a boatload of financial difficulties recently. Its market cap has dwindled to $7.54 billion, and its cash in the bank is down to about $3 billion after being twice that for a long time. Its stock price is right at $10 after being down in the $4 range a couple of years ago, so that much is looking up.

Because of its near total embrace of open-source software and the communities that produce it, Sun appears to be well poised for future growth. But it’s one thing to be ready for growth and another to actually be growing. The needed traction isn’t quite there yet to support that growth. The question is: How long can Sun hold out in giving away its software for free—now that Java licenses are going away—before sales of services and hardware make up enough of that slack so the company can get back deeper into the black?

Nobody really knows. But it had better happen pretty soon, because The Station is hearing that some shareholders are getting mighty nervous. People also are wondering if Sun can make it selling commodity servers along with services. Others are starting to talk about which companies might be thinking about acquiring Sun—whether or not it wants to be acquired.

In the meantime, Sun—though still in the black—filed a downer fiscal Q4 report two weeks ago. The company reported a 73 percent drop in earnings on slightly lower sales and said that its sales in the United States will decline for the next couple of quarters. The net income total this quarter was $88 million, compared with $329 million a year ago.

So, now for the good news: Adoption of Sun’s free (OS) OpenSolaris Operating System and its hot ZFS (Zettabyte File System) has grown by more than 20 percent in registered members in just six months. This also includes registrants for its Open Storage Program, which uses OS and ZFS.

Twenty percent is a very good number; it’s a key indicator that perhaps Sun’s fortunes have begun turning a new corner. Adoption of the now free Sun system is the first step in getting people involved and for Sun to sell its services into new customers.

Sun reported that the community is now working on more than 40 projects, including a new peer-to-peer distributed storage system and new, more efficient drivers for storage connectivity. This growing community support for the open-storage ecosystem is comprised of enterprise, Web 2.0 and high-performance computing developers and researchers, in addition to storage administrators and architects from around the world, the company said.

For more information on the Sun Open Storage community and projects, go here.