Sun seeks to restore its sheen
Published: 08 Oct 2003 11:20 BST
With its N1 initiative, Sun wants to gradually move away from being a pieces-parts supplier and become essentially a giant systems integrator -- a middleman role that makes disparate hardware and software work together, regardless of brand. Sun argues that it can better manage internal systems and reduce the artificial switching costs that have dominated technologies for years, Greg Papadopoulos, Sun's chief technology officer, said in an interview with CNET News.com.
In the process, Sun will reach into a deep stockpile of technologies that it has developed for years and finally turn them into commercially viable products. Some of its inventions, such as Jini -- Java-based software for linking devices over a network -- and related technology Jxta have languished as Sun struggled to devise a market strategy for them.
For instance, McNealy told CNET News.com last month that Sun was late in introducing its Java 2 Enterprise Edition application server, despite the fact that Sun owns at least three application server products.
Where it could all go wrong
The company's strategy, however, is far from bulletproof. For one thing, Sun's crumbling server business could be a persistent anchor that keeps the company from moving ahead.
If sales of Sun's Sparc systems decline faster than the company can increase sales of its Java Enterprise System and eventually N1, it may be in serious trouble. That, in turn, could result in calls to cut Sun's work force -- including the man at the top.
Few people are calling for McNealy's ouster, but Merrill Lynch's Milunovich and others insist that Sun needs a solid No. 2 executive. "Even Larry Ellison needed Ray Lane," Milunovich wrote of Oracle's chief executive and his former right-hand man.
In response, a Sun representative said the company has "a very deep management team. We have a team of COOs." The company has resisted repeated suggestions from Wall Street analysts to cut its massive research and development operations, which continue to grow despite losses.
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