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20060625 Sunday June 25, 2006

60 Days into the Job...

60 days into my new job, and I'm sharing an award with Steve Ballmer and Linus Torvalds. Two individuals (sharing the company of many others) I would never presume to count out, but apparently Business 2.0 does. It's an honor to share their company.

Were it me, I guess I would've waited for some business results, but maybe I said something here that annoyed them (which is ironic, given that they cite citizen media as being the most profoundly relevant force in the market today, number 1 on their 50 that matter most).

And continuing the ironies, I had the pleasure of chatting with number 44 of the 50 that B2.0 implies does matter, Bill McDonough, a couple weeks ago - click here for his and my thoughts on sustainable development, and the impact of bridging the digital divide on familial stability.

I also had a good chat with Kevin Werbach at his Supernova conference last week. What a very smart guy, and a great conference. I'll post the content as soon as it's available. Talk about someone who clearly does matter... he'd be in my top 50.

And here's a great win against Microsoft - I'm hopeful you're going to start seeing a lot more of these...

(2006-06-25 09:10:00.0) Permalink Comments [21]

20060616 Friday June 16, 2006

Ubuntu on Niagara, and Platinum Ringtones

I'd like to offer my heartiest congratulations to the Mark Shuttleworth and the Ubuntu community - what's Ubuntu? The fastest growing GNU/Linux distro out there (and as you know, volume matters). Dapper Drake is now officially available on the Sun's UltraSPARC platform, the world's only GPL microprocessor, fueling the world's most power efficient server platform. Expanding SPARC beyond Solaris to Linux opens new markets for everyone.

So... here's an invitation to developers and customers that don't want to move to Solaris, want to stay on GNU/Linux, but still want to take advantage of Niagara's (or our Galaxy system's) energy efficiency - click here, we'll send you a Niagara or Galaxy system, free. Write a thorough*, public review (good or bad - we just care about the fidelity/integrity of what's written - to repeat, it can be a good review, or a poor review), we'll let you keep the system. Free.

And if you want proof that volume matters, I thought this was interesting. The world's first platinum ringtone (known as a "blingtone") - with more than a billion wireless subscribers in the world, my bet is they're going to need to define a category above platinum...

Focus on volume, value follows... and with that in mind, where are my manners: HAPPY BIRTHDAY OpenSolaris!.

___________________

* as determined by the product team, in their sole discretion...

(2006-06-16 13:06:00.0) Permalink Comments [20]

20060610 Saturday June 10, 2006

Answer to the Roof Riddle

In answering the prior question...

As you know, computers consume a ton of energy - if you don't work in a datacenter, you may not know what I'm talking about. But you know how your laptop warms your lap? Or your PC heats up your den? Multiply that a few thousand times over, and you have a problem faced by most datacenters - power draw and heat dissipation. Map that challenge to every business on earth, and you have a global power crisis as the network is built out. (And talk to some web 2.0 startups, you'll hear many say their second biggest operating expense, after salaries, is electricity - that's why the big search companies are building data centers where power's cheap).

Back to my story... the CIO in my prior posting informed her CEO that in order to support more analytics and trading activity - the computational heart of their business - they needed to build a bigger computing grid. For which they needed more space (which isn't cheap in midtown Manhattan), and more power - to which he responded, "the CEO of the power company is a friend of mine - let me just give him a call."

The CIO replied, "no no, those are only a couple of limiters. The more power we bring in, the more cooling we need. The more cooling we need, the more power again. But the thing that's really holding us back is even with more budget for space, power and cooling, we need backup power in the event of an outage, and the generator necessary to provide backup power of this magnitude is the size of a locomotive, and the only place we could possibly put that is on the roof, and look, we DON'T HAVE ANY MORE ROOM!"

And now you know why we've been so focused on the physical size and energy efficiency of our new computing and storage platforms, in addition to their raw performance. (And if you'd like a sample to try for yourself, just click here, or read what others have experienced.) The lowest end systems start at $795 (no, that's not a typo).

_______________

And Mr. Scoble - thanks for taking the time to stop in, much appreciated. I enjoyed the discussion, too. Thank you for pioneering the medium.

(2006-06-10 21:50:00.0) Permalink Comments [18]

20060608 Thursday June 08, 2006

A Roof in Midtown Manhattan

I was on a plane flight with an executive from the hospitality industry not too long ago, who told me a very interesting story - about the impact of flat panel televisions on hotel room occupancy. According to this exec, flat panel TV's drove down industry occupancy rates.

No, seriously.

Apparently the space savings and lower power consumption of a flat panel TV (think about it, they're quite a bit smaller and draw far less energy) allowed hotels to skip having to put giant media cabinets in their rooms. And they could save on their total power (and air conditioning) envelope, as well. Which freed up space, power and budget for more rooms. Which led to a glut of new rooms, and the rest falls into place.

It reminded me of a conversation I had with a CIO at a large financial institution in midtown Manhattan a few months back. She'd just been promoted to be the CIO of her company, and in one of her first meetings with the CEO, brought him a picture of the roof of their building.

Care to guess why?

(2006-06-08 08:47:00.0) Permalink Comments [42]

20060602 Friday June 02, 2006

Sunlight is the Best Informant

I was with a big potential customer yesterday - in the Fortune 100. After a day of briefings from our technical folks, I joined the meeting to see how we were doing. I asked him and his team how much of what they'd seen was new to them.

He said, "about 70% was a complete surprise."

Ouch. That's not good.

To test, I asked, "before today, did you know that Solaris was open source, or ran on Dell, HP and IBM hardware, not just Sun's?" "Nope."

And like I said, this was a Fortune 100 opportunity.

Despite the ample advice I receive, getting through the din, especially in the world of IT, doesn't happen with a superbowl ad (can you remember a single one?), or buying every billboard in every town, or every ad word on-line. We know, we measure their effectiveness.

We know the most valued information travels by word of mouth. Through blogs, on-line reviews, or other on-line conversations. Or "kneecap to kneecap," as we sit across the table from customers in our briefing centers. And frankly, the most valuable information about Sun doesn't come from Sun, it comes from other customers.

So how do you get the word out if you don't have a $500M ad budget? To me, it's not so much about getting the word out, as letting the eyes and ears in. You can tell I'm a big fan of transparency - that's why I write a blog (with comments on, and yes, I read every one, as do a host of others at Sun). It's why I encourage others to drive the conversation in the market, as well. Transparency's at least a part of the solution. If not an outright competitive weapon.

A very wise man once said, "Sunlight is the best disinfectant" - and in my view, exposing our internals to the outside world also helps us respond to problems more rapidly. True, we have to expose the occasional unhappy customer (I hear this one, in particular, recently became happy), but we expose them to people who can help, too - from within Sun, or within the community. We can't solve problems we don't know about. Like the good justice said, sunlight's a good disinfectant.

Which is why you'll see something very interesting next week start to appear on Sun's web pages and throughout our on-line store. You'll start to see product reviews written by users. You'll see user defined ratings, right on our products. Just like book or product reviews at Amazon. We're starting with just a few products, but it'll ultimately extend all the way up to our highest end enterprise offerings.

What's the risk? That we're exposing ourselves to criticism? That we may have on display the fact that one product or another isn't perfect? (That our competitors may try to rate all our products?)

Nope.

The far bigger risk is that we'd meet another customer surprised by what we had to offer. Unaware that our systems were 5 times as energy efficient as our competitors. That Solaris was free, open source, and available on Dell or HP. Or that Thumper was about to reset the economics of the storage industry.

And to my mind, sunlight's not just the best disinfectant.

It's the best informant, too.

From a voice you'll trust more than ours - your own.

(2006-06-02 16:46:00.0) Permalink Comments [47]

20060531 Wednesday May 31, 2006

Understanding the Changes We're Driving

Please see the Safe Harbor Statement at the bottom of this page.

By now you've all seen the press release we issued today, outlining a plan approved by Sun's board of directors - in which we'll be lowering cost, accelerating profitability, and as a part of both, implementing a workforce reduction of up to 5,000 employees. At the outset, I know these changes will be tough for many employees, but I'm also convinced they'll yield a more valuable company for customers, shareholders and our remaining employees, one that's leaner and more efficient.

We've also provided insight into Sun's operating income goals for 2007, and a framework for thinking about our performance beyond that point. We've also changed elements of our corporate governance - these actions are designed to make Sun a more transparent organization, and one more responsive to long-term shareholders, and simpler to understand.

I'd like to review the thought processes that led to these decisions, and provide color on our going forward market focus and R&D; priorities.

Just after last quarter's earnings call, I initiated a top to bottom review of our markets, our R&D; portfolio, and our overall corporate resourcing. You've already seen management and organizational changes resulting from that work, reported in the past few weeks.

At a top level, these reviews were focused on simplifying Sun - making choices to clarify our priorities, speed up our progress, and drive the transparency that gives all of you more insight into where we're headed. It's been similar actions, over the years, that have enabled us to expand gross margins and deliver top line growth. But these are all points along a path, a path we're now accelerating.

So first, I'll address Sun's market focus.

Our industry is littered with companies that try to be all things to all people. That's not Sun.

In my first 30 days as CEO, I've spent a great deal of time with leaders from among our global customers – and having just completed our most successful JavaOne conference ever, with our most strategic constituency, the Java and Solaris developer communities.

I've heard a consistent message - the internet's growing at an incredible rate - and for many of our customers, the network has become core to how they engage their markets and create competitive advantage. Those are our key customers, those that see network computing as a vital element of their strategy, those pushing the limits of scale and load, and those that see IT innovation as anything but a cost center.

As we began nearly two years ago, we will continue to simplify our coverage models, adding expertise where we can grow value and share. As you've seen in Gartner Dataquest's recent Worldwide Server report, Sun did just this, gaining share with both UltraSPARC systems and x64 systems against our leading competitor/partners. We absolutely believe we can continue to grow as we focus our field and partnering resources on the right opportunities.

We will focus on those companies, from startups to global players, that see network computing as their principal route to market, principal vehicle to differentiate, and principal competitive weapon. We expect to focus our coverage in these accounts, while streamlining our efforts to extend our coverage with the world's most attractive partner community. And to be clear, we are adding coverage and technical specialists, while continuing to reduce redundant or duplicative functions. The market isn't shrinking, nor will our field presence, channel focus or partnering efforts.

Next, I'd like to focus on our research and development priorities.

As many of you are aware, Sun has one of the strongest R&D; organizations in the world - one we've sustained while our competitors have cut - leaving us with an operating system and microprocessor platform which makes our competitors begin to appear as partners. We have some demonstrable technology advantages... energy efficiency, operating systems innovation, dramatic gains in developer adoption. That's certainly the cornerstone of our recovery.

And with those assets, we serve two constituencies – developers, who create content for the network, and deployers, who purchase and operate software and hardware infrastructure in the world's datacenters. I will continue to stress that revenue for Sun is a lagging indicator of the adoption of our core developer platforms – both of which we are reinforcing with today's actions.

We will decrease some non-core R&D;, and specifically duplicative or redundant infrastructure and management processes, but we are expecting to increase our focus on developers, and on investments in Java innovation, and the open source Solaris operating system. The adoption of those technologies will continue to define large revenue opportunities for us in companies like eBay, Motorola, General Motors and American Express – all of whom, by making decisions long ago to leverage Java and Solaris, have become very significant customers - in software, in systems, in storage and services.

As the world's largest free and open source company, we expect to monetize a portion of what we freely distribute through service and support contracts, along with traditional software licensing; and through volume as well as enterprise systems and storage sales. We expect the internet marketplace to grow, and we expect our core intellectual property, for developers and deployers, to give us a significant competitive advantage against those without comparable assets. Simplicity, scale, automation and security will continue to be our differentiators.

You will see in today's actions that we will be simplifying our product line, and reducing duplicative R&D; – to help you interpret that, we will build all products at Sun from Java, Solaris, StorageTek and from our newly unified SPARC and x64 SunFire platforms. I'd like to briefly point to three products that represent the future of such systems innovations. The recently unveiled Niagara servers, the StorageTek Titanium archive platform; and lastly, an upcoming extension to our NAS offerings, code named Thumper.

Having anticipated today's datacenter focus on green computing, Sun began investing years ago in energy efficiency - as a result, our Niagara servers now operate at less than half to a fifth the power draw of our competition (potentially qualifying our customers for carbon credits). As I mentioned earlier, many of you saw the share gains Gartner reported for Sun last week – we believe we can continue to grow share, having recently taped out an even more energy efficient follow on to Niagara - we are adding support for Linux and BSD operating systems on our SPARC platforms, opening new markets for the same platform investment supporting Solaris, leveraging the same R&D; over a broader opportunity.

Secondly, the StorageTek T10000 is the highest scale and security archive offering in the marketplace – it's leveraged by an array of customers, from governments to on-line portals, and many of the world's largest institutions. But you've all heard disaster stories from banks or media companies that have "lost their tapes," revealing what was supposed to be protected consumer information. As a part of Sun, we were able to leverage our systems innovation to add high security encryption to these systems, largely eliminating the risk of losing data. Integrating our StorageTek platforms with Sun's market leading Solaris and Java Enterprise offerings allows us to solve a spectrum of business problems our storage only competitors cannot. This innovation was a matter of linking existing technologies - and will be a focus area while we reduce other proprietary approaches. And again, StorageTek systems will be built atop SunFire servers running Solaris, while maintaining their mainframe heritage and interoperability. Leveraging the same R&D; over a broader opportunity.

Finally, and arguably the best example of the alignment of Sun's systems innovation is a project we'll be announcing in late June - code name Thumper. Thumper is a SunFire server, running Solaris and its 128-bit ZFS file system, that packs 24 Terabytes of storage into a miniature package - allowing Solaris and Java applications to run directly on the storage device at breathtaking speed and price points. It's a perfect example of combining our software and hardware expertise, with an existing supply chain, to deliver a broader market, greater margins, and new customers - leveraging common IP, over a broader opportunity. We'll be announcing complete details at the end of June.

To repeat, we will be simplifying our product line, our supply chain, our development and management processes – while retaining a focus on open source innovation, horizontal scalability and security, and on service automation around our Network.com Grid. All while we continue to seamlessly interoperate with existing systems, from mainframes to Microsoft Windows.

As I stated above, we've improved gross margins over the past couple of years - we will seek to generate more value from our R&D; going forward.

Finally, I'd like to leave you with a couple notes on Transparency and Business Focus

You will hear me and Sun's Chief Financial Officer, Mike Lehman, begin to make projections of our going forward business – we have an increasing confidence in the stability of that business, and as we continue to see growth in our core developer offerings, we have increasing line of sight into new markets and customer opportunities. We will reflect that clarity and transparency to the best of our ability.

Today's changes will result in a significant reduction in non-core or redundant R&D;, field and corporate resourcing – with significant synergies arising from the acceleration of acquisition integrations into Sun. Again, we expect these changes to have little to no impact on customers, and instead to create more opportunities for business partners and suppliers to join with Sun in serving the global market.

We have believed for the 24 years of our existence in a singular vision – the network is the computer. That vision remains unchanged, and if anything, today's refinements to our market focus, our R&D; portfolio, and to our overall business model, drive us even closer to fulfilling it.

_________________________________________________________________________

Safe Harbor Statement

This blog contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding the future results and performance of Sun Microsystems, Inc., including statements regarding Sun's growth plan, Sun's return to profitability, future growth, areas of future investment, the competitive advantage that results from Sun's intellectual property and the monetization of such intellectual property, the attributes of and benefits to be derived from future products, continued gains in market share and synergies to be derived from acquisition integrations. These forward-looking statements involve risks and uncertainties and actual results could differ materially from those predicted in any such forward-looking statements. Factors that could cause actual results to differ materially from those contained in Sun's projections and forward-looking statements include: failure to achieve expected cost savings within the expected time frames; increased competition; failure to rapidly and successfully develop and introduce new products; Sun's reliance on single-source suppliers; risks associated with Sun's ability to purchase a sufficient amount of components to meet demand; inventory risks; risks associated with Sun's international customers and operations; delays in product development or customer acceptance and implementation of new products and technologies; Sun's dependence on significant customers and specific industries; Sun's dependence on channel partners; risks associated with Sun's tape products; and failure to successfully integrate acquired companies. Please also refer to Sun's periodic reports that are filed from time to time with the Securities and Exchange Commission, including Sun's Annual Report on Form 10-K for the fiscal year ended June 30, 2005 and Sun's Quarterly Reports on Form 10-Q for the fiscal quarters ended September 25, 2005, December 25, 2005 and March 26, 2006. Sun assumes no obligation to, and does not currently intend to, update these forward-looking statements.

Return to Top. (2006-05-31 14:35:00.0) Permalink Comments [31]

20060527 Saturday May 27, 2006

Share... (Gaining)

For those that missed it, definitely worth reading:

Sun Gains Share in Q1.

Innovation takes longer to deliver than a simple price cut, but if Q1 is an indicator of things to come, has more lasting value as a competitive weapon. For our customers and our shareholders. To be perfectly clear, lowering price is a tactic at Sun, not a strategy.

I was asked yesterday why we're gaining share - I said three reasons:

1. Solaris and Java are gaining momentum
No one can possibly dispute the impact free and open source software is having on the world - as the OpenSolaris and OpenJava communities continue to expand, as downloads and adoption increase, so does awareness of Sun's (and other open source community member) offerings and the total revenue opportunity. We gain share when customers deploy apps built on our platforms at a rate exceeding others. When our customers grow faster, so does our share - of licensed software, services on free software, servers and storage.

2. Galaxy, Niagara and Panther*
This one's more obvious - customers prefer our products when they're faster, draw less power and take up less space than the competition. World records help. But it's the total equation at this point - the "performance at any price" mentality is fading fast: just ask a Web 2.0(TM) startup what portion of their operating expense goes to electricity - you'll be stunned.

3. Sales and Service Execution
I was talking to a customer yesterday, one of our largest, and asked "how are we doing for you?" I presupposed the answer would surround our product roadmap, given how much time we'd spent getting them up to speed on where we're headed. The response had nothing to do with our products - their CIO just said, "your team is doing great for us, we love doing business with them."

When it gets right down to it, especially for our largest customers, people buy from people.

So congratulations, folks - well done, across the board.

______________

* those are code names for internal server projects, and I just earned myself some hate mail from the product groups that want me to stop using project names...

(2006-05-27 14:21:00.0) Permalink Comments [20]

20060523 Tuesday May 23, 2006

Busy Week...

Last week was a busy week - with JavaOne, and a flood of customers in town.

I started the week previewing the week's announcements at the NetBeans tools community gathering. Here's a little known secret: I used to run developer tools for Sun - and as I said then, and I'll say now, you need only two documents to understand a technology company's corporate strategy: their end-user tools roadmap, and their sales force comp plan. Given that the former is public knowledge, inquiring minds can wonder about the latter.

This is my JavaOne keynote - which was a ton of fun. We broke a bunch of attendance records, with something near 15,000 attendees in the room (my favorite comment came from a reporter I spoke to after the event, who said: "I was amazed at the number of languages being spoken in the audience!"). Great buzz, tons of new stuff (capped off with a real-time Java roadrace after Scott's keynote). Another reporter said, "it's like a social movement." Well, yes.

I got a chance to talk with Ed Zander, CEO of Motorola (go buy a RED phone!); and two of the world's most vocal advocates of free and open source software, Mark Shuttleworth (the guy behind Ubuntu/Debian GNU/Linux who flew up from DebConf just for this event), and Marc Fleury (CEO, JBoss, Inc. - the company bringing Red Hat into the Java community). Definitely watch the video - you'll see the symbolic passing of the pickle to Rich Green, Sun's newly minted (but refreshingly familiar) Executive Vice President, Software.

After JavaOne, I spoke with Darrell Plummer and Paul McGuckin from Gartner at their conference (video here). David Berlind, as usual, had a thoughtful analysis of the hour. Frankly, I was a little disappointed in their questioning, as well - it seemed like so many of their questions had been hashed out in blogs and user generated analysis.

But all in all, a really great week - we're now making serious progress on open sourcing Java (and despite the cynics, using a GPL license is very much *on* the table), while focusing the debate on what matters most: not access to lines of code (that's already widely available), but ensuring compatibility. Compatibility is what brought a record number of people to JavaOne this year (making it the world's largest free software conference), it's what's behind nearly 3 billion+ Java enabled devices. And for those that missed the subtlety, that compatibility is what creates the market Sun, and others, can monetize with network innovations, from software to hardware and services.

Seems like an obvious connection to me...

[update: fixed broken link] (2006-05-23 14:30:00.0) Permalink Comments [10]

20060515 Monday May 15, 2006

Java, and Survival of the Most Adaptable

Change is a constant at Sun. So long as the market's changing - or so long as we can change the market - we're going to evolve. As Darwin said, it's not the strongest organisms that win, it's the most adaptable.

To that end, today we announced a series of changes designed to prepare us for the next wave of system challenges and market opportunities. I want to thank Mark Canepa for years of extraordinary commitment and devotion to Sun, and welcome John Fowler (who will lead Sun's Systems businesses) and David Yen (who will lead Sun's Storage businesses) to their new roles.

Speaking of changes, tomorrow morning, I get to deliver my favorite speech of the year, my keynote at Java One. I get to do so wearing my fancy new title, "Chief Java Evangelist," a title I now share with our Chairman.

I'm still amazed when I hear folks wondering how Sun monetizes Java. So at the risk of repetition, I'd like to share a few thoughts.

When Thomas Edison first introduced the lightbulb, he held patents he tried to wield against potential competitors - he wanted to own the client (the bulb) and the server (the dynamo). He failed. Standards emerged around voltage and plugs, and GE Energy (formerly, Edison General Electric), to this day, remains one of the most profitable and interesting businesses around. How big would the power business be today if you could only buy bulbs and appliances from one company? A far sight smaller, I'd imagine. Standards grew markets and value.

Then there was the civil war era in the US, when locomotive companies all had their own railroad widths and shapes - designed only to work with their rail cars and steam engines. How'd they fare? They failed, standards emerged that unified railways and rail lines, and that era created massive wealth, connecting economies within economies. Standards grew markets and value.

To get to the impact on a global scale, you should really read Mark Levinson's The Box. Which talks to the extraordinary impact the standard shipping container had on global commerce. No, I'm not joking. It democratized global commerce. And it ain't even done.

So if you want to know how I feel about Java, my view is it's changing the world - standardizing the plugs and rail gauges and containers used by global internet players. Its momentum, in my view, is unstoppable. What's that worth to Sun? Give it your best shot. When I do, I say most of our revenue is derived from Java. Just like most of Verizon's revenue comes from handsets. Even though the economics of the handset look baffling (but I dare you to recommend to Verizon that they stop selling them). Those that believe free software or service yields lower revenue don't understand the economics or dynamics of the software industry. Think Google or Yahoo!, not Maytag.

So for those in attendance tomorrow, thank you for joining us - at what's become the world's largest free and open source software developer conference. Believe me, there's a huge tent waiting for you - I just walked the main hall, and you could fit a few Space Shuttles in the place.

And somewhat off topic, a family member of mine once asked if I ever got nervous before keynotes - when I mentioned having nearly 20,000 folks in the audience this year, they nearly passed out. My response was simple - what's it like talking to your family about their accomplishments, no matter how big a family gathering? It's easy, it's what comes naturally, it's called being a member of a community, and feeling pride. Talking about what you know and love is like falling off a log (vs. rehearsing a keynote you don't care about, my worst nightmare - second only to extreme turbulence).

So I'll see you tomorrow morning, on-line, or in person. Like I said, it's my favorite part of the year, like spending time with family (and just wait until you see who joins the family tomorrow...).

(2006-05-15 09:10:00.0) Permalink Comments [20]

20060506 Saturday May 06, 2006

Announcing Greg Papadopoulos, CTO and EVP, R&D;

Greg Papadopoulos (Sun's Chief Technology Officer) and I made a joint customer call recently, to the COO of one of the world's largest on-line companies. The customer made an interesting point - his job was getting more technical. A change from a few years ago, when his priority was big web traffic deals and traditional business development. The customer was a technologist to start, so he was in his comfort zone, but it had become increasingly obvious that the next generation of differentiation on the web was going to come from technology innovation - not just good BD or branding.

Now as you may have heard, I gave Greg a new title recently. In addition to being Sun's CTO, he's now Executive Vice President of Research and Development. Why's that important?

Well, Sun is a company built for engineers, by engineers. I know that probably rubs some folks the wrong way, who want to hear me say we're a "transformative value solutions" company (I can't keep a straight face saying it). But let's face it: value in information technology is coming down to how efficiently you can get something done. Whether it's building a 30 teraflop grid or a web services infrastructure; powering a Java handset or an entire datacenter. From what and who I see, the folks who measure that efficiency are getting more technical, not less.

When the tools are chosen or the RFP's are written, when the benchmarks are done or the operators take over, technologists are playing a more prominent role in our industry, not less. At least for our key customers, who live and die by technology (vs. those that should be shutting down their datacenters to buy network services from our core customers). Nick is right, IT Doesn't Matter to those for whom IT isn't a differentiator - but those aren't Sun's customers. Our customers live and die by IT.

So as a part of this change, the product group CTO's, the sentinels supporting the line executives who run our businesses, will also report to Greg. In the world of human resources, that's known as a "dual hard line" reporting structure. On the one hand, that's only a symbolic change.

On the other, it is a very clear indication of where we're heading. You cannot build a house by motivating sub-contractors with compelling visions of the future. That's why you hire an architect. Similarly, you can't build a network computing company without a chief architect to coordinate nearly $2 billion in R&D.; And as a systems company, we now have a chief systems architect (and a fellow blogger).

This is also a signal inside and outside Sun: I am redoubling Sun's commitment to the primacy of the systems technologist, the systems innovator and the systems engineer. And not just in engineering - but across Sun as a system itself (more on that in a later blog). Our core customers, those who develop systems and services, who operate, administer - and pay for - them, need thought partners and system (not component) suppliers. Most business problems, in our world, have solutions rooted in innovation - and primarily technical innovation. That's our history, and our future.

I'm thrilled to have Greg assist me in driving focus and simplicity throughout Sun. From our great new developer tools, all the way up to identity enabled encrypted tape.

There are an ever smaller number of true systems innovators - those that can bring together the software, the hardware, the network and services layers, to form a coherent and compelling platform for the future of network computing. In your datacenter or in your pocket. We're committed to be exactly that: an innovator that delivers value as measured by those who live or die by innovation.

Please join me in congratulating Greg as he helps to define a new era of technical leadership at Sun.

___________

ps. For those interested, here's a Q&A; I just did with Forbes. And yet more focus on the things that really matter (at least the Inquirer has a sense of humor).

(2006-05-06 07:30:00.0) Permalink Comments [11]

20060430 Sunday April 30, 2006

On Blogging as CEO

It's been a busy week. My heart rate seems to have slowed just to the point where I can taste food again.

I want to start by thanking Sun's global volunteers - who every day work to improve the communities in which Sun operates around the world. I had the option of cancelling my volunteer commitments given this week's events, but decided to keep it - and had the privilege to visit Blacow elementary school, and talk to a group of 1st grade students and their teacher about the internet. They showed me their StarOffice skills (no, I'm not joking), and when I asked how many of them had email accounts, about a quarter of the room raised their hand. These are first graders, mind you. (I asked one student who sent her email, and she said her Mom, but only when she travelled.)

So I'd like to thank the folks that organized my visit, Mrs. Lorenz for putting up with my questions about how many of her friends knew that OpenOffice was free (on Windows, too!) for all schools throughout the world, and the terrific first grade class for their outstanding presentations.

Earlier in the week, I hosted my first Leadership Conference as CEO. Sun's Leadership Conferences bring together our global leaders twice a year to exchange ideas, discuss priorities, and share best practices. This year was a little unusual - Scott and I communicated his stepping up to Chairman, and my stepping up to CEO. We did so in front of a global town hall on the first day - we had nearly 20,000 (!) employees on-line to watch the event. You've already seen the speech I gave - it's my last blog entry.

Emotionally, it was one of the toughest speeches I've ever given - and I want to thank those of you that added comments, and supported Scott on your own blogs, and throughout the media.

After my speech and a fairly thorough question and answer session, Scott left the auditorium - handing the keys to me, and saying, "I'm going to spend the next 90 days opening every door on the planet. Call me if you need me." And then it was my Leadership Conference. It happened that fast.

The theme of this year's event was simple: Growing. Through Pace and Transparency - it's not just our products that are speeding up this year. We're going to be driving unparalleled transparency into everything we do, precisely because it's the most efficient mechanism to accelerate change throughout Sun. Transparency enables everything to go faster, invites accountability (to which most folks in large organizations aspire), and drives dialogue between Sun and the communities we serve.

So to answer the obvious, for those that have asked the question, "as CEO, will you continue blogging?"

Absolutely yes - count on it. (We'll now be the only Fortune 500 company with a CEO that blogs - the first of many firsts to come.) It's just one of many ways we're going to turn Sun inside out - on our path to growing value (not just revenue or earnings).

And if you want to know who committed to redefining Sun Microsystems, it's these folks, the global leadership team at Sun.

I'm the guy in the center wearing the tie - and before you ask, no, the dress code isn't changing (and if you were going to be in a photo your mother would see (not this one, she doesn't read my blog), you'd wear a tie, too).

In upcoming blogs, I'll cover Greg Papadopoulos's new role at Sun; and my priorities in the next 30 days.

(2006-04-30 20:11:00.0) Permalink Comments [36]

20060425 Tuesday April 25, 2006

When I First Met Scott...

I remember the first time I met Scott McNealy - I'm sure he doesn't remember it. It was in the board room in our old headquarters in Palo Alto. I was with one of the folks from the startup I ran, and we were meeting on the advice of a mutual customer. I think it was 1992 or '93. Before you could actually explain the internet to your parents.

I remember he talked about network computing in a very strange way - he just assumed the future, he'd already moved his entire mindset, and his lifestyle, to the network. He looked at the world through the network. And remember, the network didn't really exist back then. It was a twinkle in a terminal window.

We were talking about the state of the industry - he viewed it in terms of a world that hadn't been built. I viewed it (remember I was at a startup) in terms of what business I could close next quarter. I had payroll to make. And I can honestly say I'd never met anyone so plainspoken about the future. Or so facile with soundbites to describe it. He was confident in a cheshire cat kind of way, not arrogant or professorial. He was in on a secret: the network is the computer.

You may not remember what it was like in 1992, but Wall Street had Sun in its sights - Scott was getting all kinds of flak for not following the rest of the industry. He'd refused to endorse one particular technology, known then as the Chicago Project. A few of the pundits said, "The Chicago Project is the future, and Sun's fighting it." Scott didn't think so. They said he was religious.

But he wasn't making a bet. He was fulfilling a vision. A vision that was obvious to him, and a vision in which the Chicago Project would play a bit part - we had bigger things to focus on.

If you don't remember the Chicago Project it was the code name to Microsoft's Windows 95. The companies that adopted it - and replaced their own innovation - well, you can't name them any more. They lost their ability to participate in the future, to differentiate.

What happened to Sun? Scott, and leaders across Sun, changed the world - by making an unpopular, but wildly successful bet on the internet as a driver of demand for systems innovation. The network is the computer.

A few years after that meeting, Netscape licensed the Java platform, my company was acquired by Sun, and I began working for Scott's then CTO, Dr. Eric Schmidt. I saw the vision, the concept behind "the network is the computer," wasn't just Scott's - everyone that worked at Sun thought his vision was obvious. And back in 1996, it was becoming more true, but not the certainty it is today - the world back then was fundamentally changing. Capital was shifting. Huge numbers of companies were being started and staffed, all over the world. Businesses were being transformed, started from nothing and becoming global titans. Enormous wealth was being created - durable wealth, not the donut franchises or sock puppets folks love to hate. Companies like eBay, AOL, Amazon, Yahoo! and Google.

And it has been, since that time, a wild ride for me, and for all of us at Sun. We've seen a massive global buildout, that took a pause in 2001 - remember, bubbles always precede buildouts. And Scott, back in 2001, when our revenue - given how focused we were on startups, on financial services and on telco customers - was on its way from 18 billion down to around 11... Scott was far more focused on what was going to happen in 2006 than worried about that quarter. He had that same confidence in the future I first saw in 1992. Bet on innovation and innovators. Stick to your vision and your visionaries.

Which is why he preserved R&D;, and jobs, when the world told him otherwise. Why we preserved our relationships with the developer community. Why we redoubled our investment in systems innovation. Why we increased our attention on key customers and partners. Even broadened it to include some unfamiliar faces.

And nearly two years ago, Scott forwarded me something a journalist had written about Sun, and about Scott personally. It wasn't the most positive note, and it was criticizing us for the bets we'd made, and for a vision that at that point, didn't square with the reality in front of us - the new Chicago Project of the day looked more attractive.

And I sent a note back to Scott. Every once in a while you end up as the morale officer for your boss, and it was one of the rare days at Sun where I was more enthusiastic than Scott.

And what I told him then - is what I'll tell you now.

There is no single individual who has created more jobs around the world than you. And unlike Henry Ford and some of the industrialists that preceded you, not all of those folks just work for Sun - I'm not talking hundreds or thousands of jobs, I'm talking millions. They ended up in America and India, Indonesia and Antarctica, Madagascar, Mexico, Brazil and Finland. They ended up everywhere. Everywhere the network travels.

No single individual has spawned so many startups, fueled so much venture investment, or raised so much capital without actually trying - just with a vision of the future that gets more obvious by the day.

No single individual has so effectively created and promoted the technologies at the heart of a new world emerging around us. A world in which the demand for network computing technology will never decline - as we share more family photos, watch more digital movies, do more banking on-line, build more communities on line, run our supply chains, automate our governments or educate our kids.

And no single individual, outside my family, has been a greater influence on my life - I am quite confident the same is true for millions of network consumers across the world. It's probably less obvious to them as it is to me. You have defined for me what tenacity means. What integrity, courage and commitment mean. Inside of work, and outside.

Which is why I'm thrilled you're sticking around for the next twenty years. To lend that confidence to the decisions I make, to help spot the next Chicago Project, and to send me the email boosts I've needed in the past, and I know I'll need in the future. It's not your fingerprints that will be all over our return to prominence, it'll be your footprints right underneath it.

As I said before, we are in a rare industry - in which demand for what we build, for the technologies that power the network, will never cease. Not even the oil industry can count on that. We have the same vision today as we did back in 1992 - a vision that only gets more true as each day passes, and only gets easier to describe to your parents, and to an ever younger population that seems to know that vision in their hearts.

The network is the computer.

Thank you, Scott, you are a hero to us all.

(2006-04-25 10:45:00.0) Permalink Comments [67]

20060416 Sunday April 16, 2006

The Brazilian Effect

I was honored to meet the President of Brazil last week.

I'm not one to name drop, but this is one of those extraordinary interactions I had to put in a first sentence - I'll return to why I met with him in a moment, but I was having a hard time with a graceful segue later in this post. So with that done...

I've given keynotes at Java One for many years, and one of the things I've grown to expect is what I'll call the "Brazilian effect."

Having just returned from a trip to Sao Paulo and Brasilia, I can confirm Brazil's one of the more progressive nations in the world when it comes to the use of free and open source software. It's got one of the largest, and most vibrant developer communities (great to see the OpenSolaris community putting down roots!),

and as a result, there's never a shortage of interesting projects for me or James to reference during our talks.

But whenever you mention Brazil or a Brazilian project, you have to watch out for the Brazilian effect, the total disruption of your speech by a contingent of flag waving (and wearing) Brazilians that, upon hearing their nation mentioned, break into hoots and hollers and whistles and applause. It takes a few minutes to die down, and the enthusiasm's contagious. And it drives a bit of competitiveness from folks all around the world who want to know why the Brazilians get to have all the fun. (Let's see more flags this year!)

Brazil's very focused on making Brazil a better place - and an open network is playing a big role. There are nearly as many mobile handsets in the market as there are credit card holders (the former are well on their way to being default micro-payment, as well as application platforms), and the number of Brazilians with broadband access is skyrocketing. There's a move to drive all of Brazil on-line, as a means of connecting Brazil to Brazil, and to the global market - and free and open source software is playing an instrumental role.

So I'd now like to say, "I understand the Brazilian effect." There is a distinct sense that Brazilians want a better Brazil, that there's a pride in its progress and evolution. There's a palpable energy, even and maybe especially within the halls of its government institutions (where it's sometimes harder to find energy in other nations). I had an opportunity to travel to the seat of power in Brazil, to Brasilia, a city with an interesting history.

And once there, I met with the Congressional President, and with President Lula himself. We talked about free and open source software, the future of the network, and how Sun could help bring more Brazilians on-line, while transferring the skills and technologies that create jobs and export opportunities. And not because Sun's a charity, but because it's good for our business, too - more Brazilians on-line drives more business for Sun, as a connected citizenry participates, with media companies, government agencies, financial institutions and one another. But Brazil knows it can't afford a connected society without the competition and opportunities brought about by free and open source software.

The Brazilian government is aggressively focused on digital inclusion, on bringing every segment of society to the 'net. They're making some of the world's largest investments in free software, leveraging it to deploy next generation network platforms spanning traditional telecommunication infrastructure to digital television. (One of the lead government IT folks was walking me through the lobby of their Congress, showing me their voting systems, and proudly said, "we're only running open source software now. We run Solaris.") The IPTV projects are really interesting - in scale alone (there are more TV's in Brazil than mobile phones, and go take a look at the size of the country if you're interested in network topology problems).

But the rollout of digital TV, and the internet itself, is threatened in Brazil by licensing authorities and patent holders, who are holding Brazil, and every other developing nation, hostage to royalty claims and licensing fees. Claiming that open source software isn't safe (it is, we indemnify our open source customers just like we did when our software was closed source), or that the foundation technologies will obligate Brazil to pay extraordinary royalties for each citizen or citizen access (not true, either).

Those threats are simple - patent holders (who have names very familiar in the IT world) and licensing authorities (sponsored by the same companies) are impeding the rollout of the network to developing nations. We were there to present an alternative, as we're doing across the world. Presenting those alternatives to drive progress, transparency, and ultimately demand for what we build.

Because bridging the digital divide is what gets us out of our seats, hooting and hollering. The network effect, after all, is Sun's Brazilian effect. And stay tuned on our progress - we're hoping to have some interesting things to announce shortly.

And once again, during a town hall in Sao Paulo, I was asked, "what are you going to write in your blog about your visit to Brazil?" My response, "I'm going to write about how great our team is." A great team, doing important work, not just important for our customers, but witness the meeting with President Lula, important for Brazil.

Congrats, Cleber and team - keep it up!

(with apologies for the folks who got cut off on the edges - next time, I'll be sure we've got a far wider lens...)

(2006-04-16 23:05:00.0) Permalink Comments [5]

20060320 Monday March 20, 2006

The Network is the Computer

Allow me to once again apologize in advance for a lack of brevity. This is one of those blogs you wait a career to write.

A few years ago, I was sitting across from a Wall Street CIO, one of many I was visiting in New York. I was asking them all the same question, "do you feel the grid you're building is delivering a competitive advantage to your business?" (For those that don't know what a grid is, it's a collection of low cost network, storage, computing and software elements, lashed together to do work that historically required very expensive dedicated proprietary technologies). I asked the same question of CIO's in the energy industry, using grids to find oil. In the life sciences industry, using grids to discover drugs or model proteins. In the movie industry, using grids to render movies.

The answers I received, typically delivered by an impassioned CTO that had spent a year building a grid, was always the same: "absolutely yes. Our grid is way better than any of our competitors'."

I haven't stopped asking that question. But about a year ago, after Sun outlined plans to build a public, multi-tenant grid (just like the power companies run), and make it available for $1/cpu-hr, and after a few industry notables began suggesting change was afoot, I started hearing a different tune. "Um... maybe my grid's no different than anyone else's."

Now, since John Gage first uttered the phrase, Sun has been saying "The Network is the Computer." It's one of those rare vision statements that only becomes more true over time. And next week, we're going to prove the point by unveiling the world's first on demand supercomputer. And by on demand, I mean accessible through your browser, with a credit card. This isn't yesterday's definition of On Demand, involving custom financing contracts, prepositioned inventory and a sales rep in a crisp blue suit ready to negotiate. Nope, our definition is just like eBay's: you bring a browser and a credit card, we offer the service. No fuss, no muss. We believe the simplicity, accessibility and affordability of this service changes the face of computing for all organizations, large and small, public or private.

The Sun Grid (which will be officially unveiled in a few days) is an offering we and our partners will be expanding over the months and years to come - like any good product, there's no end to the innovation possible. This represents not only the future of product development at Sun, but like the Java platform and the internet itself, it really represents the future of computing.

As strange as it may sound, consumers are way ahead of most enterprises when it comes to using grids (and paying for them). Most of us live on the grid at home - we use Google and Yahoo!, we love eBay, we upload and share photos and movies, and gather our news from various sources on the web. Most of us bank from home, we leverage network email services - and if you think about it, that transformation all occurred within the last decade. In the blink of an eye.

But behind the corporate firewall, the transformation toward multi-tenant grids has been slower. Frankly, it's been tough to convince the largest enterprises that a public grid represents an attractive future. Just as I'm sure George Westinghouse was confounded by the Chief Electricity Officers of the time that resisted buying power from a grid, rather than building their own internal utilities. But that's not to suggest it hasn't been happening in the business world.

Witness the meteoric rise of Salesforce.com - or RightNow, or PayPal - or any of a number of other services designed to replace traditional infrastructure behind the corporate firewall. Smaller businesses especially have flocked to the grid to spare themselves the headaches of architecting and owning their own datacenters.

But larger enterprises have been tougher to convince. As an example, for the past 15 months, we've been negotiating with one financial institution interested in leveraging our grid for spike loads of portfolio simulations. When their procurement team held up the contract to start negotiating the gauge of chain link we'd use around the grid, and which vendors were approved to supply network cables, we gingerly passed them back to our traditional sales channels - this was clearly a customer that would prefer to build their own infrastructure (can you imagine arguing with PayPal over chain link?). So be it, that's where most IT is purchased today, and will likely be purchased for decades to come.

But there's no denying there's a change occurring.

A good friend of mine, a bioinformatician (love that title), once described how frustrated he was at having to wait for his university's supercomputing facility. "If you had a grid available on line, I'd bring my whole budget to you." Granted his budget was something like $10,000 a quarter, but rumor has it there's a good business in the long tail. My view - most computing will be purchased by that tail. There are, after all, far more small financial institutions than large. The same applies to movie studios, pharmaceutical companies, academic institutions, and nearly every other industry on earth. I'm very comfortable betting on the value in volume - and the willingness of those smaller firms to change culture, process and lifestyle to get a competitive advantage through network services. Just think back ten years - when most enterprises I met laughed at the idea of putting business systems on the internet. Now you're an anomaly if you're "off the grid."

But getting to this week hasn't been without hiccups. After we announced it, we started working with a number of companies interested in negotiating the equivalent of chain link fencing, as above - we saw IBM Global Services (and HP's equivalent) in every one of the deals. We learned a lot, but mainly that most enterprises today define On Demand computing as hosting - they want to give their computers, software, networking and storage to a third party, and rent them back for a fixed price. But that'd be like an electricity company collecting generators and unique power requirements, and trying to build a grid out of them. That's not a business we're in (nor one in which technology plays much of a role - it's all about managing real estate and call centers, as far as we can tell). Grids are all about standardization and transparency - and building economies of scale.

Building a secure, publicly available multi-tenant grid also turned out to be exceptionally complex - there's a reason no one had ever done it before. Most grids are application specific - for search, or auctions or payment. A general purpose computing grid was ploughing new ground - and we wanted to ensure availability and security would be as high as possible. To stress the grid, I actually sent mail to all of Sun's employees challenging them (with the promise of a new workstation) to see if they could bring it down. On the theory I'd rather have a Sun employee, especially a Sun engineer with deep insight into our products, show us how to break it, than a rogue user.

After disappointing a huge swath of our employees who couldn't participate in the contest (our export control policies constrain which elements of our global workforce can be exposed to the grid), we surfaced several vulnerabilities in the very high-scale interaction of hardware, networking and software platforms (again, given that no one's ever done this before, it wasn't all that surprising). We also engaged with the folks who monitor technology export control for the US Government (if there's a harder civil service job in the government, I'd like to know it) - who helped us ensure the grid wouldn't be accessible to people with nefarious intent. They understood we wanted to make this as simple as applying for an eBay account - we'll be close, but we've got to have a higher level of scrutiny (which is why, when you apply for an account, it'll take a few hours, and won't be instantaenous - but that's our goal).

Those are just a few of the hurdles we faced, but now we're ready - ready to release the first, publicly accessible instantiation of the future of computing. And here are a few things to be aware of:

First, in this first release, the Sun Grid will be available only to customers inside the US. Why? Export constraints. Stay tuned for international availability. And yes, we will be doing this globally.

Second, don't expect instant account provisioning. We're shooting for a few hours, depending upon demand, and no worse than 24 hours. But please be patient. We are focused on ease of provisioning, but we're also conscious of the risk and security requirements.

Third, we're opening on day 1 with less than 5,000 cpu sockets (both Opteron and UltraSPARC) - the world's most power efficient servers. As demand emerges, we'll be adding to that capacity - without limitation.

And finally, stay tuned for the web service API's. What you'll see this week is relatively simple, and a version 1.0 foundation for what's in store. Where are we headed? To release computing as a service, to be mashed up with other services (I can hear VC's around the world offering a standing ovation - 'no more having to build one datacenter per startup!')

If you're read this far, here's a final bit of color on the incredibly fortuitous domain name for the future of computing: Network.com.

As it turns out, midway through Sun's due dilligence in the acquisition of StorageTek, we learned they were the owners of Network.com. They hadn't really ever used it - a hidden gem. In hindsight, it may end up being one of the most valuable domain names in the history of computing. And we're certainly going to do what we can to burnish that value...

So have at it! Go to network.com later this week, grab a PayPal account, and experience for yourself what it's like to use one of the world's largest supercomputers. Without having to house it, manage it, power it, administer it, provision it... or buy it.

The Network is the Computer.

Once again, more true by the day.

(2006-03-20 00:13:00.0) Permalink Comments [35]

20060309 Thursday March 09, 2006

Why Free Standards Matter

Imagine you live on a sleepy street in a coastal town, say Rio de Janeiro. And a hurricane or tsunami hits your shores. And the government agency responsible for telling you how and where to get relief, for provisioning aid and emergency services, sends out a curious message: if you can't afford a copy of Microsoft Windows, we're sorry, we can't help you.

That's exactly what happened in New Orleans a few months back. Which led many folks to see the convergence of telecommunications, technology and media in a very personal, and dissatisfying way - while demonstrating the vanishing distinction between web services, social services and emergency services. The network is all about moving data around, whether purchase orders, tax forms or storm paths.

Last weekend, I had a similar personal experience. I was on my way to show my kids what snow looked like, taking them to Lake Tahoe, in the Sierra mountains. If you know Northern California, you know that means crossing Donner Pass. A place that makes me think of that great Andy Grove quote, "only the paranoid survive." During winter storms, you don't drive through that area lightly - there are even police at checkpoints to make sure you're well equipped - with chains for your tires, or a four wheel drive vehicle. City-folks like me even pack water, food and blankets. Just in case.

Before leaving, I checked the weather. A winter storm was approaching, and knowing the State of California places web cameras in key locations to help monitor traffic, I went off to a search engine, and typed "California highway video" to get a real time view of road conditions.

And what did I see?

A California State Agency web site that required Windows Media 9. I happened to be running my Solaris laptop at the time. So I couldn't receive the video. As a tax paying citizen of the state, my government was inadvertently telling me I could not receive state emergency services without buying a Microsoft product. Governor Schwarzenegger, I don't want my or my employer's tax dollars going to promote a monopoly in California. (Love them though I do as a business partner.)

So now you know why the Open Document Format Alliance is important - in a democratic society, agencies, corporations or individuals that serve the public's interest should be free to do so without burdening their constituents with an obligation to purchase one company's product. That's what the ODF Alliance will help achieve - by creating and making freely available to anyone that wants it, a standard for representing document based information.

It seems plainly wrong for a government to suggest that citizens purchase Microsoft Word before reading a storm warning or ballot initiative. Or that they abandon their Macintosh to run Internet Explorer before applying for disaster relief. Or that they buy a Windows Mobile phone before requesting 911. Or that they have Solaris installed to pay their taxes.

And rather than sit by and complain, several of us - competitors and partners alike, along with a broad cross section of global industry and library associations - are all banded together to promote a standard for the free interchange of document based information. A standard that doesn't require any one company's technology, or a royalty check or fear of patent litigation. A standard that leverages a common interest in having a free, open and neutral standard to which any company, individual or government can subscribe.

A standard that serves the public's interest.

And to put our money where our mouths are, the first application to fully support ODF is the world's most popular free/open source office productivity suite, OpenOffice - which we encourage governments to distribute to their citizens. There's no better way to serve the public's interest than to give them freedom.

And choice.

(2006-03-09 23:59:00.0) Permalink Comments [21]


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