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Sun-IBM Watch

Everybody's sources dismissed the notion that IBM's due diligence was anything more than standard fare

The folks at the Wall Street Journal who brought us tales of IBM buying Sun for $6.5 billion-$8 billion last week were saying by Friday that due diligence was holding up any announcement.

The paper seemed to think that IBM lawyers were paying particular attention to Sun's many different IP licenses and formal agreements, including that 2004 antitrust deal with Microsoft that proved such a financial windfall for Sun. It got a patent cross-license out of it too.

Perhaps they're weighing whether Sun really had the right to open source Solaris. That was a mare's nest.

Reuters agreed with the Journal that any deal could take "several more days as IBM studies various parts of Sun's computer server and software business."

Nobody's sure how many days it will take.

Everybody's sources dismissed the notion that IBM's due diligence was anything more than standard fare.

The Journal, however, may have found another antitrust roadblock to the deal when it pointed out that buying Sun would give IBM a monopoly on the tape drive business where Sun is the only current competitor for the widgets used with mainframes and other big systems.

IBM's already got a problem with Unix systems so its lawyers are expected to do some fancy footwork with market definitions and broaden them out.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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