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With emotion, Sun's long goodbye nears the finish
With emotion, Sun's long goodbye nears the finish
By Patrick Thibodeau | Jan 26, 2010
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James Gosling, the father of the Java programming language, posted the image of a tombstone on his blog last week, an R.I.P., for Sun Microsystems Co. Before long. more than 800 employees, outside developers and others had posted comments.
The responses, under the headline, "So long, old friend...," were similarly eulogizing, many offering up a simple "thank you" mixed with some sadness, a few memories and sprinkles of hope for the post-merger.
On the same day Gosling posted his tombstone, CEO Jonathan Schwartz sent around an internal memo expressing his pride at having worked at Sun and urging employees "to emotionally resign from Sun," and prepare to take "the first step in a new adventure."
What wasn't said in Schwartz's note -- and isn't clear at this point -- is how many at Sun will continue with the merged companies.
Schwartz and some of Sun's other top executives will leave with large severances; in Schwartz's case, that would be more than $12 million in severance, according to Sun's recent proxy statement . The Wall Street Journal is reporting today that Schwartz will soon resign.
With European regulatory approvals for the deal all but final, Oracle and Sun plan to hold Webcast briefings on Wednesday to outline the direction of the combined companies and their many products.
Sun has about 29,000 employees and the combined headcount of the two firms will be about 115,000. Analysts, however, expect cutbacks to take place once the merger begins in earnest.
Oracle and Sun announced their plans to merge in April but the uncertainty about Sun's future goes back a little further, to March, when news surfaced that Sun was in acquisition talks with IBM.
Oracle wanted the merger completed sometime in last fall, but European regulators' delay in approving the merger has dragged it out. That, in turn, may have hurt Sun's share of the server market. Its worldwide server systems revenue totalled $778 million for the third quarter of last year, a 35% decline from the same quarter in 2008, according to IDC's latest report on worldwide systems factory revenue. All vendors saw revenues fall in the recession, but Sun's decline was the steepest.
Even so, Jean Bozman, an IDC analyst, points out that Sun remains the fourth largest server vendor in the world, after IBM, which had 30% of the world's market share with $3.3 billion in revenue in the last quarter; Hewlett-Packard, with a 31% share and $3.2 billion in revenue; Dell , with 13.5% and $1.4 billion; and Sun, with a 9.5% market share.
