Failed IBM Buyout Could Speed a Setting Sun

Today's Best Tech Deals

Picked by PCWorld's Editors

Top Deals On Great Products

Picked by Techconnect's Editors

IBM will be remembered as the last, best hope for Sun Microsystems. Unless you believe IBM wasn't serious and would have eventually walked away regardless, then Scott McNealy was foolish to any reasonable terms that Big Blue offered.

I can imagine no circumstance in which Sun will soon be worth as much as IBM offered for the company. Nor do I believe another potential suitor--of which there aren't many--will make as good an offer.

Scott McNealy, Sun's chairman and co-founder, apparently split with the company's president, Jonathan Schwartz over the deal. Published reports say a rift has developed between the two executives, with Schwartz in favor and McNealy opposed to the deal.

How serious a rift? Those close enough to the two men to know are not talking, but this is the sort of misunderstanding that could lead to someone's departure, and it will not be McNealy. Even if it should be.

I've never been as impressed by McNealy as the rest of the world seems to be. As a co-founder, McNealy may be too committed to keeping the company on life support when those less emotionally involved realize that Sun has been setting for quite a while.

McNealy needs to understand that nothing lasts forever. Sun has lasted at least a decade longer than really made sense. The company has managed to stay alive and independent, but those days are numbered.

Looking at the highly competitive server world, Sun has been slow move to Intel-standard processors and its moves to become the leader in open source have not found much success. Indeed, IBM has managed to become the company that Sun wanted to be.

As for the deal, the breakdown seems to have been over whether IBM had too much leeway to walk away from it. That makes me wonder why McNealy was so concerned. Did he question IBM's good faith or might he believe that as the negotiations continued that IBM would find a valid reason to walk?

Either way, if IBM and Sun don't come to terms, it's hard to believe that another suitor will make a better offer. Of the bunch, Dell and Cisco are the best candidates, but neither could leverage Sun as effectively as IBM might.

Frankly, I've never understood how Sun has survived so long. If the goal of a company is to merely survive, shareholders be damned, then Sun has been successful.

My hope--for Sun's sake--is that IBM will come back to the table and a deal will eventually be made. If the deal doesn't go through, it's likely that someone will eventually put Sun out of its misery, but the price won't be nearly as good.

David Coursey knows a sunset when he sees one. Write to him using the contact form at

Note: When you purchase something after clicking links in our articles, we may earn a small commission. Read our affiliate link policy for more details.
Shop Tech Products at Amazon