Sun rise, Sun set?
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I thought Scott McNealy stepping down as CEO of Sun Micro would have been the final sign of the Apocalypse. But the other sun rose this morning, and everything seemed reasonably right with the world. So calm down, we’ll all survive (even though the tech industry may not be as humorous ).
What is simultaneously understandable and puzzling is the elevation of Jonathan Schwartz as the top dog. Aside from the comical sight of Schwartz’s ponytail swaying while ringing the NASDAQ bell, the value of his leadership remains questionable. According to Schwartz’s unofficial bio, he has not headed a technology company of note or strong financial success. He worked for, and eventual lead Lighthouse Design, which made non-noteworthy applications for the failed NeXT line of workstations. His claim to fame, and an early attraction to the big wigs at Sun, was that Lighthouse sold their wares over the Internet at a time when doing so was novel and way to far ahead of the market.
Schwartz’s blog is instrumental in understanding how he perceives technology and Sun’s relationship to the market. Over the past months he has used his blog to poorly articulate the value proposition of Sun products, and to intellectually disconnect himself from his audience.
What Schwartz fails to show is an understanding of any particular market, what drives buyer motivations, and the result market dynamics. His justifications for Sun’s Rent-a-grind, lack of acknowledgement of the fundament change cause by commodity hardware and operating systems, or even why Java makes some people nervous, indicates he will have a difficult time doing the one thing CEOs must do — communicate.
This may be why Scott McNealy says he is will spend the next 90 day traveling and evangelizing Sun products. McNealy, though complicit in Sun’s failure to adapt to market changes, is a gifted speaker and one who commands attention. He has a bluntness that allows him to praise Sun, slam Microsoft, and kick Mark Hurd in the virtual crotch . . . all in the same punch line.
Yet unleashing McNealy on an unsuspecting planet will not address the basic issues that created Sun’s current predicament. Larry Ellison saw that middleware was being commoditized, and began turning Oracle into an application vendor well before the DBMS bloodletting began. Sun has only limply responded to Linux (by giving away Solaris) and x86 processing power (by building an Opteron server). Both moves are symptomatic of the elder Sun, being slow and merely reactive. Losing nearly a billion dollars a year cannot be sustained for long (2.5 years given their current cash holdings and burn rate).
So Sun will rise or set based on Schwartz’s next few moves. Personally, I’m stocking up on flashlights.
