Sun Steeled for IT Uptick

CEO Scott McNealy weighs in on the economy, Linux and Microsoft's security efforts.

Scott McNealy has guided Sun Microsystems Inc. since its founding in 1982, through upturns and downturns, dot-com booms and busts. Now, he finds himself jousting with his old nemesis Microsoft Corp. on one side and simultaneously jousting and embracing the open software movement on the other. We caught up with McNealy, Suns chairman, president and CEO, at the companys headquarters in Santa Clara, Calif., recently to get his take on these matters, as well as his view on the health of the industry.

eWEEK: What happened to the tech economy, and where is it headed over the next year?

McNealy: I dont make any predictions, but I can tell you what has happened. We had the Y2K bubble, the telecom bubble, we had the financial services day trader bubble, the Internet bubble, and they all built on each other. That has all come home to roost, and we have a pretty tough capital equipment scenario right now.

eWEEK: Any prediction of when the upturn will come?

McNealy: I dont know. Im an economist, and I can tell you honestly and accurately that I dont know.

eWEEK: What will be the attributes of an upturn?

McNealy: Well get a lot more orders. Were taking it a little on the chin in that people are not buying in a systematic approach. They are buying in little piece parts because that is all they can get in under the radar.

eWEEK: What does that mean for Sun?

McNealy: The implication for us is a huge consolidation. Basically, everyone is out of the Web tone switch business except IBM, WinTel, Sun and Hewlett-Packard [Co.], which is moving to a reseller model. There is nobody in Europe and nobody playing in Asia anymore. The high-end business is suffering more than the low-end business. The telecom [and] the financial service providers are all struggling, so they are not buying anything. The under $100,000 server business (where I think we are No. 1) is our fastest growing market. And in storage, our low-end storage tends to be doing better than our high-end storage because we are coming in under the CFO radar.

eWEEK: And the final result of all that low-end proliferation?

McNealy: A huge administration nightmare. I guarantee two or three years from now we will be talking about server consolidation big time, administration technologies and big servers to [control] these wheat fields full of blade servers.

eWEEK: Big servers running on Solaris or Linux?

McNealy: The big ones will run on Solaris.

eWEEK: Wheres the dividing line?

McNealy: That depends on a couple of things. One, do you need 32-bit or 64-bit? Thats a clear dividing line. If you want a large address space, you have Solaris. If you want to live the lifestyle of Linux, youll go Linux. If you want to live open interface, but not open source, you will go Solaris.