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Sun Was Shopped Around the Valley, Says Intel

By - Source: Tom's Hardware US | B 15 comments

I don’t know about you guys, but I love the smell of a desperate merger in the mornings and if there’s one thing a recession brings, it’s corporate drama.

CNet today reports that according to Intel CEO Paul Otellini, Sun, in an effort to find a buyer, was “shopped around the valley” over the last few months. Apparently one employee at a recent webcast asked Otellini if Cisco's decision to enter the storage market was what drove Sun to look for potential buyers. Otellini’s response was published in an SEC filing yesterday. Here’s what the CEO had to say:

Oh, I don't know if the Cisco entry spurred IBM. I think (a) cheap Sun price--a low price--spurred a lot of interest. I can tell you that Sun was shopped around the valley and around the world in the last few months. A lot of companies got calls or visits on buying some or all the assets of the company. It looks like IBM is in the hunt now. And at a hundred and some odd percent premium, I suspect they'll get it.

I don't think it had anything to do with Cisco. I think IBM is trying to consolidate architectures. IBM has the strongest Java license in the industry. By picking up Sun--which is the creator of Java--they really consolidate their position not just in Linux, but also in Java.

I think the stuff on Solaris and SPARC is likely to see EOLs over time through the IBM acquisition. But no strategic reason for IBM to maintain that except to attempt to convert the very large Sun SPARC Solaris base to power. I think that would be their most likely strategy as part of this.

Is it good or bad for us? I don't know. I'd rather have Sun be independent, I guess.

Judging by your comments not too many of you are ecstatic at the thought of an IBM-Sun merger. Some of you said IBM was turning into Microsoft (although others said Microsoft could never be IBM) while others questioned the fate of SPARC and your free Java programs. Who would you like to see buying Sun? It’s perfectly grand if you’re all for an IBM-Sun merger, but we’d like to hear your ideas for alternatives!

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  • 1 Hide
    theuerkorn , March 26, 2009 12:30 PM
    I am fine with the merger, though IBM is withdrawing more or less from the hardware business and to some degree that's probably spells doom for Sun's hardware. Nevertheless, I think IBM kept the server business and software like Java fits right in IBM's portfolio. Is it going to stay free, very likely, but also that there may be a not-for-free commercial version sometime down the road.

    More concern in this economy is IBM's new business model of cutting cost by exporting as many American jobs a possible (just recent news had another 5,000 layoffs in the US to move to "emerging markets"). They appear to make profit that way (which is never bad for a company).
  • 1 Hide
    sublifer , March 26, 2009 1:08 PM
    I like Sun and their support for the Open Source community. I have a strong feeling that if IBM took over Sun that we'd see a drastic decline in free open source software and support and IBM would find a way to turn it into a revenue stream which would in effect kill the whole thing.
  • -6 Hide
    Anonymous , March 26, 2009 1:57 PM
    It would be good for IBM to own Sun. Then Sun would have no reason to fund open source (which is done to mess up their enemies by some kids in basements ripping off IP).

    Who knows, maybe we'll actually see a Java Server OS if this happens.
  • Display all 15 comments.
  • 2 Hide
    goryachev , March 26, 2009 3:04 PM
    I think IBM just wants to purchase SUN cheap, as described in the article. I don't think there would be any impact on open source, since IBM also supports it (eclipse for example).
  • 3 Hide
    cadman252 , March 26, 2009 3:24 PM
    I have reservation on a possible Sun-IBM merger. IBM didn't handled some of their past mergers well. Past botched mergers include software companies with good software, a decent customer/user base(AmiPro, Lotus 123, etc.), only to mismanage the merger and loose their customer base and market share to Microsoft.
  • 7 Hide
    cruiseoveride , March 26, 2009 3:24 PM
    I think SUN should stay independent. For the good of technology.
  • 1 Hide
    city_zen , March 26, 2009 3:39 PM
    I'd *love* for Google to buy Sun .... I know, I know, but hey, I can dream, right?
  • 0 Hide
    neapolis , March 26, 2009 5:19 PM
    Yes, that IS true and would make perfect sense. Google should buy Sun!
  • 2 Hide
    jstrode , March 26, 2009 6:27 PM
    Quote "though IBM is withdrawing more or less from the hardware business and to some degree that's probably spells doom for Sun's hardware."

    IBM Cell processors are in full swing and power most current consoles, as well as their server line. No one, and least of all Intel, believes that IBM is "getting out" of the hardware business. I also guarantee that the way of the sparc is lost forever if this happens.
  • 1 Hide
    sacre , March 26, 2009 7:33 PM
    Isn't Sun the company that is working on Photon powered CPU's that apparently pump out 400-1000x more power then todays CPU's?
  • 0 Hide
    o0 zeno 0o , March 26, 2009 7:44 PM
    I'm beyond worried... If IBM acquires Sun, how will I ever be able to properly explain what the Solaris tattoo on my pastie white derriere is all about?

    Let's face it, AIX is a pain. Mainframes are dead, why do I have to be reminded of the awkwardness of them every time I have to log into a p570? Not to mention the reliability vs Sun is horrendous. You spend all your days doing firmware upgrades, just to spend weeks on the phone with clunky IBM support to tell you "Oh yeah.. now that we think of it, just ignore that error.

    I would love to see Google buy Sun. I can't really think of anyone who I would like to see buy Sun. Fugitsu would be one possibility I guess. I just hate to see all these great things come out of Solaris 10 (zfs, zone cbvm's) just for the company to crash and burn.
  • 0 Hide
    o0 zeno 0o , March 26, 2009 7:49 PM
    joeman42So what? Sun was dying a slow death anyways over the last few years and the reality of java has never lived up to its promise (and never will, IMHO).

    Are you insane? I loath java, but have the crap you use probably uses it. Even in the enterprise, you have apps like Oracle Application Server that run out of Java containers.

    If by "dying a slow death" you mean the stock was declining, then fine... But more amazing things have come out of Sun in the past 5 years than have come out of IBM.
  • 0 Hide
    andy_newton , March 27, 2009 3:20 PM
    It will be interesting if Apple to buys Sun. It has lots of cash in hand and has not laid off a single soul. Mac OS X Server will definitely soon run on Sparc hardware and carry ZFS file system. I have not really understood what benefit it will offer over HFS+ but at the moment many experts praise ZFS.

    Perhaps Solaris users will be left behind though since "the Steve" will definitely put an end to it in favor of Mac OS X. Unless he's out his mind, there is a slight chance that future release of Mac OS X will be based on Solaris.

    But again, who knows.
  • 0 Hide
    comxpert , March 29, 2009 6:02 AM
    i think microsoft should be the one! to improve their "weaknesses"
  • 0 Hide
    llemm , March 29, 2009 7:56 AM
    Michael Shuttleworth should buy it.