ESR predicts that Sun is 'doomed'

CRITICISM OF SUN reached a crescendo this past week. Apparently triggered by Sun's restatement of its prior quarter financial results, a remarkable variety of industry observers have written analyses, advice and admonitions.

Perhaps the harshest criticism came from Eric Raymond (who is widely known in the Linux community only by his initials, ESR).

We reported Sun's restatement of its last quarter revenue here. The restatement stemmed from a $1 billion non-cash write-down in a tax loss carryforward account. Our moles guessed that FedEX talking with HP and Red Hat was the reason for Sun's sudden loss of confidence in selling enough this quarter to offset that prior quarter carryforward. [Are you shure we understand this? - Ed]

But I've got another theory -- based partly on disbelief that any single customer, even mighty FedEX, could cause such a massive swing in Sun's revenue expectations. Instead, I suspect that Sun miscalculated badly by slipping a few million to SCO in the hopes that SCO would derail Linux. Obviously, SCO hasn't even put a dent in Linux adoption in Sun's market, much less derailed it. On the contrary, Sun may even have seen a backlash.

So instead of data centers reversing course on planned Linux conversions on commodity Intel servers, back to Sun Sparc servers running Solaris, Sun's sales reps might even have seen Linux migrations step up in pace.

After all, if I were a CIO/CTO with a mixed Solaris and Linux shop, I'd be more comfortable upgrading Sun systems if I believed that Sun would also integrate well with my Linux based servers and provide scalability paths onto its Sparc machines for my Linux applications software. Conversely, I might not return calls from Sun reps if I believed Sun hated Linux, as suggested by funding a scurrilous crew of pirates trying to steal Linux or else destroy it along with the entire open source paradigm.

No, I don't think I be thrilled with a firm attempting to lock me in to five-fold higher hardware and software costs using underhanded means.

If I'm right that this is what caused Sun's precipitous decline in sales expectations for the current quarter, this -- along with its denigration of Linux generally -- ranks as a major miscalculation. Although it's not (yet) as colossal a mis-step -- like falling off a cliff -- as Intel has made by trying to force much of the industry onto a new and incompatible processor architecture, Sun's rejection of Linux servers might get there eventually. After all, so far this mistake has only cost Sun $1 billion in revenue, while Intel's sunk years and billions into ghost ship Itanic. It remains to be seen, however, if Sun will ever finally come to its senses on Linux, as well as in its attitudes and directions in other areas like Java's fate.

Anyway, after Sun's restatement of financial results hit the streets, it was quickly followed by a concerned analysis at NewsForge, titled "What Sun needs to do now to survive" here. Moody's downgraded Sun's corporate bonds to just one step above junk so fast it almost made our own Cher Price dizzy here. Wednesday, we carried Terry Shannon's article noting Sun's sudden change of direction with regard to Linux on servers here. Then yesterday, Merrill Lynch wrote a strongly worded warning calling for Sun to cut expenses, narrow its focus, change its attitude, and generally shape up before it loses relevance and gets bought out for its installed base, and that's linked here. Also on Thursday and in the harshest criticism of all, Eric Raymond lashed out at Sun without mercy, also at NewsForge. ESR even predicted that Sun is now -- in his words -- "doomed". Raymond's furious jeremiad leveled against Sun's major prior misdeeds and its present fecklessness is here. µ

L'INQS
NewsForge 1
NewsForge 2

See Also
Sun takes $1 billion charge
Sun rated one step above junk
Sun radically changes Linux Mantra
Merrill Lynch tells Sun's Scott McNealy to get his finger out