Sun’s second rise

In the 25 years since Sun Microsystems was founded the company has certainly had its ups and downs, to put it mildly. But of late the vendor seems to be showing signs that it is on its way up once again. IT Weekly speaks to Sun's Jean-Paul Bergmans.

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By  Administrator Published  April 5, 2007

There are no second acts in American life F. Scott Fitzgerald once wrote. If any company might want to prove him wrong, then Sun Microsystems would surely be a good candidate. The firm that was once a dot.com darling had been hit hard by the dot.com bust. If any firm could do with a second act, then Sun is surely it.

The decision by co-founder and CEO Scott McNealy last year to step aside from day-to-day management duties and pass the reins to Jonathan Schwartz was seen as an attempt to do just that. McNealy had made himself unpopular with Wall Street analysts by his reluctance to cut jobs, especially the engineering jobs that he considered vital to the long-term success of the company. Schwartz wasted little time making the job cuts that Wall Street wanted, committing to making an 11 to 13% reduction in headcount of Sun's 37,500 workforce worldwide.

So, as Sun celebrates its 25th anniversary, where is the company now?

"We are a technology company and we are proud to be a technology company," is the blunt response from Jean-Paul Bergmans, Sun Microsystems vice president for South and Eastern Europe and MEA, in Dubai as the company turns 25. "I don't think we are decreasing the focus on engineering, we are increasing the focus on business," he stated.

While McNealy very definitely was "the engineers' friend", he was actually an economics major; Schwartz comes from a software engineering background and has his own technology blog, Bergmans pointed out.

What has changed at Sun, Bergmans said, is Sun now has a more coherent business strategy, one in which it continues to deliver on innovation, but where it makes sure that it can then sell it. "It is our role to make sure that our customers and partners understand that technology can help them do business and that is what we are doing now - and doing much better."

One area where Sun has focused heavily on is selling computing power to those customers who see IT as giving them a competitive edge - the eBays, Salesforce.coms and so on.

While this might suggest that Sun is still focusing too much on the dot.com-type players, Schwartz last year said that people were focusing too much on the bubble's bursting.

"The bubble pops, a lot of people lose a lot of money, companies fail, but what's left is a global build-out," he said then. Schwartz cited the examples of the railways and utilities industries, both of which had seen dramatic bubble bursts, but had gone on to become real business sectors.

Results so far seem to be bearing out this bullish tone: Sun's last set of financial results, reported in January, saw the firm beat analysts' expectations for profitability - a tonic for a company that had spent years in the red.

It is not all plain sailing however: just this week the company saw shares fall following a critical analyst's report, suggesting Sun will miss its next fiscal targets.

While Bergmans was interviewed before that report came out, he argued that the market is increasingly supporting Sun's vision.

Case in point: thin clients. Sun has been promoting the thin client idea for a decade or so - along with other firms, such as Oracle. While the thin client has struggled to find a market, Sun is now selling them in increasing numbers, Bergmans said. He hinted at a forthcoming deal with IBM, which will see Big Blue work with Sun on developing and selling thin clients. Although Sun executives declined to be drawn on details of the IBM deal, the company clearly believes that thin client is an idea who's time has come.

As has Sun's most famous slogan: the idea that the network is the computer does not seem so hard to believe in a world where social networking is the norm. So how will Sun stay ahead? "We had this vision 25 years ago, actually most other vendors are now realising that this is reality," Bergmans said.

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