There is little valid criticism that can be leveled at Sun Microsystems Inc at the moment, but the company which claims networked computing is at the heart of everything it does, thinks it needs to grow itself substantially, and to implant the name Sun into everyone’s hearts and minds. It is also attempting to lose the negative implications of Unix, and is having a go at raising Solaris as a brand in its own right, one it hopes will be used in the same breath as Java and NT, not to be confused with HP-UX, AIX, Digital Unix, Irix or any of the other myriad flavors of a language fighting for survival.
By Joanne Wallen
At a European press and analysts briefing in Brussels on Tuesday, the company’s newly appointed chief financial officer Mike Lehman said the company’s $16bn market capitalization is not enough, and Sun wants it to be higher. Its aim, therefore, is to grow the business substantially, to take cost and time out of the current sales and general administration equation, and increase the bottom line. Lehman claims the company is currently very undervalued. He believes the market opportunities for Sun are mind-boggling compared to two years ago, driven in part by issues such as Year 2000 and European Monetary Union, which are forcing companies to re-evaluate their computer systems and in many cases migrate to new systems, and also by the increasing adoption of the internet and intranet. Lehman does not deny that Sun itself has Year 2000 and EMU problems of its own to sort out, but he believes the company is in an excellent position to benefit, because it is one of the few true owners of technology, the others being Microsoft Corp, Intel Corp and Cisco Systems Inc. The way to this growth and continued success is to continue with its existing strategy, according to Ed Zander, appointed chief operating officer in January, (CI No 3,332), and responsible for the company’s recent re-organization into seven new product divisions (CI No 3,395). Zander apologized with tongue firmly in cheek for not having a new strategy to offer the gathered audience, but insisted that the current one was the one which has served Sun so well in the past and will continue to serve it well into the next century.
The Number One in Enterprise Networking
That strategy is to be the Number One Enterprise Networking Company and to focus on three areas and three areas only, SPARC – the processors behind its hardware range, Solaris and Java. Echoing Lehman’s view that the company has tremendous opportunity ahead of it, Zander says this translates to an opportunity to bring the network age to the consumer, not by going directly into the consumer market, but by enabling our partners to go for the networked consumer. The company that coined the network is the computer wants to bring the network to anyone, anywhere, anytime and on anything. By focusing solely on network computing, not entering into PC’s, printers or systems integration, Zander says Sun outgrew the rest of the industry last quarter with 12% growth compared to nearest rival Compaq Computer Corp’s 8%, even without Wintel. Sun is also focusing now on climbing up the enterprise, boasting a lot of new wins in major banks including Spain’s Caja Madrid, Credit Suisse, and the French postal service La Poste, all of which required extremely robust systems with 7 by 24 availability. Underpinning this robustness is Solaris, which Zander claims is the best, most rugged and reliable mid-range operating system. He studiously avoided any mention of the word Unix when mentioning Sun’s operating system, as if by doing so Solaris would become the new de-facto mid-range operating system. The value of a name is hardly lost on Sun, which admits that had Java been called D++, it would never have got where it has today. Java, Zander says, is now shifting from a consumer, client-side language to an enterprise tool. The explosion will be Java at the server level, Zander promises. He predicts large scale Java deployment is on the way, helped along by Java OS for business being developed by Sun and IBM Corp. People want thinner clients, he says, especially in fixed applications. Sun’s raft of new server announcements (CI No 3,400), will enable substantial increases in performance, the company says, further aiding the deployment of mission critical server-side Java applications. But in order to grow the business to another level, Zander admits Sun will have to create the demand. It has doubled its brand awareness in the past couple of years, but that is only to 12% from 6%. Zander says the company will seize the big opportunity and spend money not only on print and television advertising, but also on roadshows and seminars to raise awareness of the company. The new simpler organizational structure, is apparently aimed at spreading the word, and the word is Sun from now on. One of the company’s other big challenges is convincing people it has the professional services in place to support 7 by 24, mission critical systems. Zander admits that while Sun is very strong on the product side, and it wins many of the benchmark wars, it still has some trouble convincing customers that it has the service and support capability in place. Naturally, he says the company is working on its coverage and actively recruiting professional service personnel. It currently employs more than 1,000 people worldwide. It also uses partners to deliver the 7 by 24 coverage, and Zander claims Sun has no intention of getting into areas such as systems integration, which would deflect it from its core business. Zander gave no figures on how much Sun aims to grow, but it is clear that it is going after IBM and Hewlett-Packard Co in the enterprise business. The future is bright, Zander concluded. The network is no longer the computer apparently, the network is now the business, and Sun aims to be at the very heart of that business.
