Welcome!

Agile Computing Authors: Liz McMillan, David H Deans, PagerDuty Blog, Elizabeth White, Pat Romanski

Related Topics: Java IoT

Java IoT: Article

McNealy: "Sun Does Not Favor Mega-Mergers"

Sun's CEO and Chairman Holds Forth On His M&A Philosophy

According to Sun, its mergers and acquisitions – unlike Oracle's, Adobe's, and AT&T's – aren't quick fixes aimed at instantly growing its customer base. They're "thoughtful, strategic acquisitions that complement and enhance our historic strengths." Sun Microsystems, McNealy claims in a memo sent to Sun's customers this week, takes a different approach from the rest of the industry giants.

But hold on. Sun has completed no fewer than nine acquisitions during the past three years. McNealy points out as much in his memo. So what's so different between its approach and the approach of, say, Adobe/Macromedia, Oracle/PeopleSoft, HP/Compaq, and the pending AT&T/SBC deal? According to McNealy, it's this:

"Our team ... looks to acquire companies that will give Sun a strategic advantage in terms of intellectual property, new technologies, and human capital. We are looking for big ideas and bright leaders who will push Sun forward."

Still not convinced that this is any different from hoovering up companies merely to instantly grow one's customer base? Then how about this:

"Since our founding, we have acquired numerous companies, deals that have helped strengthen our server, storage, and software products and helped us develop big concepts like grid computing. Not every deal we've done has worked out the way we thought, but each acquisition was undertaken for a set of very specific reasons — needs on our part, and abilities and assets on theirs."

Refreshingly honest, huh? Sun's M&A philosophy, McNealy writes, is predicated upon a zest for what he calls "true investments," in terms of time and intellect and passion. Sun's interest is in companies "that have great technology and great people."

So it's not that McNealy hides the fact that, like all the other giants, Sun has become a consolidator in the market swallowing companies that it views will help it become "the technology infrastructure provider of choice to companies and individuals that rely on the network for opportunity." It's that he contends Sun's kinder, gentler approach to the process ought to earn it kudos.

Here is a list of Sun's "thoughtful, strategic acquisitions" in the past three years - which seem to add up to fourteen not nine as McNealy mentioned but hey who's counting:

Clustra Systems (networking)
Afara Websystems (chip design)
Terraspring (utility computing)
Pirus Networks (storage)
Pixo (digital rights management)
CenterRun (utility computing)
Nauticus (hardware/switching)
Kealia (2/4/8-way AMD Opteron processor products)
SevenSpace (services)
Waveset (identity management)
Tarantella (thin client technology)
StorageTek (archival storage)
SeeBeyond (business integration software)
Procom (NAS assets)

It's good to know that, in what Sun's chairman and CEO calls "an era of tech mega-mergers and acquisitions," Sun is so at odds with the prevailing zeitgeist of slash-and-burn. But Wall Street does not always reward long-term strategic management. And Sun shareholders are not wild with the firm’s sub-$4 share price. But McNealy, as ever, is undaunted.

"We currently have the strongest product portfolio ever," he declared in his memo; Sun's M&A efforts, he wrote, are in part what makes the company successful both today "and in the years and decades to come."

JDJ hopes and believes he is right. But Sun shareholders at its annual general meeting in Santa Clara just voted in favor of revoking the company’s "poison pill," Sun’s defense against any possible hostile takeover bid. A staggering 84% of votes cast were in favor of giving Sun's management this bloody nose. Defiant to the last, however - according to the San Jose Mercury News - McNealy said at that annual general meeting that he will work at Sun until the board asks him to do otherwise:

"I am working my tail off. There are no heels dug in here."

More Stories By Jeremy Geelan

Jeremy Geelan is Chairman & CEO of the 21st Century Internet Group, Inc. and an Executive Academy Member of the International Academy of Digital Arts & Sciences. Formerly he was President & COO at Cloud Expo, Inc. and Conference Chair of the worldwide Cloud Expo series. He appears regularly at conferences and trade shows, speaking to technology audiences across six continents. You can follow him on twitter: @jg21.

Comments (1) View Comments

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


Most Recent Comments
HonestyPays?Not! 10/29/05 06:42:39 AM EDT

When he says "Not every deal we've done has worked out the way we thought," I wonder what that does to the stock price of Sun? He's in charge, right? Kinda scary.

@ThingsExpo Stories
SYS-CON Events announced today that 910Telecom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Pulzze Systems was happy to participate in such a premier event and thankful to be receiving the winning investment and global network support from G-Startup Worldwide. It is an exciting time for Pulzze to showcase the effectiveness of innovative technologies and enable them to make the world smarter and better. The reputable contest is held to identify promising startups around the globe that are assured to change the world through their innovative products and disruptive technologies. There w...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - comp...
DevOps at Cloud Expo, taking place Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long dev...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, will discuss the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
There is growing need for data-driven applications and the need for digital platforms to build these apps. In his session at 19th Cloud Expo, Muddu Sudhakar, VP and GM of Security & IoT at Splunk, will cover different PaaS solutions and Big Data platforms that are available to build applications. In addition, AI and machine learning are creating new requirements that developers need in the building of next-gen apps. The next-generation digital platforms have some of the past platform needs a...
SYS-CON Events announced today Telecom Reseller has been named “Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Telecom Reseller reports on Unified Communications, UCaaS, BPaaS for enterprise and SMBs. They report extensively on both customer premises based solutions such as IP-PBX as well as cloud based and hosted platforms.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
With so much going on in this space you could be forgiven for thinking you were always working with yesterday’s technologies. So much change, so quickly. What do you do if you have to build a solution from the ground up that is expected to live in the field for at least 5-10 years? This is the challenge we faced when we looked to refresh our existing 10-year-old custom hardware stack to measure the fullness of trash cans and compactors.
The emerging Internet of Everything creates tremendous new opportunities for customer engagement and business model innovation. However, enterprises must overcome a number of critical challenges to bring these new solutions to market. In his session at @ThingsExpo, Michael Martin, CTO/CIO at nfrastructure, outlined these key challenges and recommended approaches for overcoming them to achieve speed and agility in the design, development and implementation of Internet of Everything solutions wi...
Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is expected in the amount of information being processed, managed, analyzed, and acted upon by enterprise IT. This amazing is not part of some distant future - it is happening today. One report shows a 650% increase in enterprise data by 2020. Other estimates are even higher....
Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no id...
Identity is in everything and customers are looking to their providers to ensure the security of their identities, transactions and data. With the increased reliance on cloud-based services, service providers must build security and trust into their offerings, adding value to customers and improving the user experience. Making identity, security and privacy easy for customers provides a unique advantage over the competition.
Smart Cities are here to stay, but for their promise to be delivered, the data they produce must not be put in new siloes. In his session at @ThingsExpo, Mathias Herberts, Co-founder and CTO of Cityzen Data, will deep dive into best practices that will ensure a successful smart city journey.
I wanted to gather all of my Internet of Things (IOT) blogs into a single blog (that I could later use with my University of San Francisco (USF) Big Data “MBA” course). However as I started to pull these blogs together, I realized that my IOT discussion lacked a vision; it lacked an end point towards which an organization could drive their IOT envisioning, proof of value, app dev, data engineering and data science efforts. And I think that the IOT end point is really quite simple…
Personalization has long been the holy grail of marketing. Simply stated, communicate the most relevant offer to the right person and you will increase sales. To achieve this, you must understand the individual. Consequently, digital marketers developed many ways to gather and leverage customer information to deliver targeted experiences. In his session at @ThingsExpo, Lou Casal, Founder and Principal Consultant at Practicala, discussed how the Internet of Things (IoT) has accelerated our abil...
Is the ongoing quest for agility in the data center forcing you to evaluate how to be a part of infrastructure automation efforts? As organizations evolve toward bimodal IT operations, they are embracing new service delivery models and leveraging virtualization to increase infrastructure agility. Therefore, the network must evolve in parallel to become equally agile. Read this essential piece of Gartner research for recommendations on achieving greater agility.
SYS-CON Events announced today that Venafi, the Immune System for the Internet™ and the leading provider of Next Generation Trust Protection, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Venafi is the Immune System for the Internet™ that protects the foundation of all cybersecurity – cryptographic keys and digital certificates – so they can’t be misused by bad guys in attacks...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.