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Oracle is killing Sun Microsystems.
The two companies announced the $7.4 billion deal the morning of April 20. For the rest of the tech industry, it’s a sad day. Dress in black and mourn. One of Silicon Valley’s finest is gone. If the Valley were a tree, Sun would be one of its major roots. Like so many Valley entrepreneurs that followed him, Sun co-founder Scott McNealy came from Stanford University. McNealy and the other Stanford-graduate co-founders brought intelligence and style to Valley startups. During the 1990s and early 2000s, Sun’s cool heat bathed many Valley startups with inspiration.
McNealy co-founded Sun in February 1982, based on Unix workstation work done by another co-founder, Andy Bechtolsheim. Sun showed Valley startups how to be all business. During the 1990s, the company craftily pushed into enterprise computing with big-iron Unix servers that rivaled IBM mainframes and ran software that reached where Windows couldn’t scale.
Sun also took on Microsoft, in the courts: the lawsuit about Java, and the antitrust complaint filed with the European Union in 1998. Sun lost more than it gained from the Java scuffle, but scored a scathing victory in Europe; there, in March 2004, trustbusters ruled that Microsoft acted anticompetively by withholding protocol and other information necessary for third-party server software to work well with Windows.
McNealy enjoyed the anti-Microsoft limelight during the 1990s. He gained notoriety, and not all of it good, for mouthing off against Microsoft and Chairman Bill Gates. McNealy’s sharp criticisms-what some people might call witticisms-shot out like solar flares from, well, the sun. After McNealy abdicated the chief executive’s chair to be only chairman, CEO Jonathan Schwartz stepped into the anti-Microsoft limelight. But the color of Sun’s light changed. During Schwartz’s tenure, Sun courted and embraced open-source developers, releasing Solaris to open source as OpenSolaris, bolstering its commitment to OpenOffice development and, in January 2008, acquiring MySQL.
But for open source, the Oracle-Sun deal casts shadows of uncertainty. What will Oracle do about OpenOffice or MySQL? Will Oracle CEO Larry Ellison gleefully pull the plug on LAMP (Linux, Apache, MySQL and PHP/Python/Perl)? MySQL is a nasty little competitor Oracle has no reason to keep. The open-source database is as much a nuisance to Oracle as it is to Microsoft. Microsoft CEO Steve Ballmer finally has something to thank Ellison for. Perhaps he should send flowers and a card. For all the enmity generated by McNealy for Microsoft and Gates, the sale to Sun is a precious gift-given suddenly, unexpectedly. For Microsoft, Oracle’s Sun acquisition is potentially a huge victory over open source.
Ballmer and Gates can thank McNealy for his part in undoing the deal with IBM. Now that merger would have been nasty for Microsoft. Sun software would have strengthened IBM offerings in the enterprise. IBM also could have used MySQL, OpenOffice, Solaris and StarOffice as clubs with which to beat Microsoft. IBM commands customer respect and delivers great service. Increased IBM support for Sun open-source projects could only have been bad for Microsoft.
Oracle is a very different company from IBM. While culturally IBM and Sun are thousands of miles apart, light years seemingly separate the corporate cultures of Oracle and Sun. If the companies were bears, Sun would be a panda and Oracle a grizzly. Oracle’s hard-ass tactics are legendary among enterprise IT organizations. Many IT managers I’ve spoken to over the years, particularly in government, complain that they may need Oracle software, but they don’t love the company for it. Sun is more loved-and for many reasons: the technology, corporate culture and well-trained reseller channel. Buy buying Sun, Oracle will get access to many new customers in verticals such as government and telecommunications.
Oracle is sure to darken Sun, or at least what distinguished the company and made it one of the fathers of so many Silicon Valley startups. What Oracle gains, many other constituents-be they competitors, customers or developers-will lose. Soft-spoken Schwartz will give way to loud and frenetic Ellison. He casts a long and menacing shadow, surely enough to obscure Sun’s light.
Joe Wilcox is the editor of Microsoft Watch.