Sun Was Shopped Around the Valley, Says Intel

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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  • theuerkorn
    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).
  • sublifer
    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.
  • Anonymous
    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.