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.
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eWEEK: Is there an opportunity for 64-bit Linux?
McNealy: Im sure there is as soon as they have a 64-bit Intel [Corp.] chip to run it on. [laughs]
eWEEK: You dont see any competitive threat from Itanium?
McNealy: Go read the New York Times article [which questioned whether Itanium was too late to the market]. That was kind. The Times never really got into the technical aspect of why Itanium is going to struggle. Second, go talk to a software developer [about] what it means to rewrite your software using these new, immature compilers. Third, who is going to do all the work to go evangelize Itanium?
McNealy: Sure, so you are sitting here today where youve got an UltraSPARC Solaris running on UltraSPARC 3 today, and UltraSPARC 4 by the time they get out there with Itanium, maybe even UltraSPARC 5—absolutely binary-compatible, 64-bit forever. What do you think it takes in terms of price performance to go off of SPARC Solaris to go to “Itanic”? What OS is it going to run? How long until the Itanic price/performance surpasses SPARC in the 64-bit arena? Not in our lifetimes unless we really blow it.
eWEEK: How do you respond to the criticism that Sun is trying to do too much, go into too many new areas in a down economy?
McNealy: Every bit of research and development we do goes into creating a big frigging Web tone switch. Gridware, directory, apps server, Solaris, Linux and storage area networks are features of the big frigging Web tone switch. Every technology we have fits into this environment. It is all about making this the most fully featured, integratable switch. If you dont like our app server, you can put BEA [Systems Inc.s] in, and it will still work. If you dont like our Web server, put Apache in. If you dont like our directory, put Novell [Inc.s] in there. If you dont like our storage, put EMC [Corp.s] in there. We dont recommend it, but you can. What Bell Labs solved for dial tone, we are trying to solve for Web tone. Bell Labs job was easier.
eWEEK: Why would a customer adopt the Sun cloud over the .Net cloud or the IBM WebSphere cloud?
McNealy: First of all, the WebSphere cloud is about like this (draws a tiny dot). It is not an end-to-end architecture. It is an app server. They are trying to build it out under one big brand, but so far I dont see the vision. Their vision is Global Services where they say, This is too hard, dont try this at home. Well darken the skies with Global Services. If youve got a wallet, weve got a Hoover. Well stay until one of two things happens, either you run out of money or we fix your problem.
eWEEK: And the Microsoft [Corp.] .Net architecture?
McNealy: With effect to .Net, there are major differences. One is scale. Security is the next.
eWEEK: Do you think Microsoft is getting any better at security?
McNealy: Excuse me? Their rhetoric is getting way better. Solaris is what you see in the three letter agencies and the Defense Department. Trusted Solaris is the best brand by far in places where it is a life-and-death–literally life-and-death–kind of environment.
eWEEK: And the other differences?
McNealy: Availability. When you have a utility you cant go down. Youve got to have stuff that just stays up and running. Availability hands down over .Net. Another difference is disintermediation. Microsoft Passport is all about creating a dossier on your customers, which Microsoft owns. With the Sun Liberty Alliance and the Sun [Open Net Environment] architecture, it is all about you protecting your customers.
eWEEK: And the .Net pluses?
McNealy: I will tell you what .Net does better. They have a really slick development tool that allows you to really quickly go from idea to prototype. You can walk in a matter of days, hours or weeks to your boss and say, “Look, isnt this what you want?” Now when you go into production, you get all these scalability, availability, security problems, and you get welded shut and locked in. But, man, do they get you quickly to something you can show off. Its very seductive. It is incredibly seductive.
eWEEK: And will Sun catch up in the development side?
McNealy: We are working really hard on our tools.
eWEEK: And your plans for the future?
McNealy: We are going to stay focused. You know what I like? Everything is getting connected to the Internet. Everything is getting connected to that cloud. And most everything isnt yet. There is still a lot of upside in this business, and were gaining share.
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