As an admitted software bigot, I'm glad to hear that you're once again planning to bet the future of Sun Microsystems on software.
I know you mean it this time, though this is at least the fourth time we've heard this promise in recent years. I also know you've tried through acquisitions (Forte, Chorus, and NetBeans, to name just a few) to make a go of it in the past. And I realize that thanks to Sun, Java is an industry standard, despite the fact that everyone makes money on it but you.
But having just spent the day on your web site, listening to interviews with your new software chief, John Loiacono, and presentations by your former software chief, Jonathan Schwartz, I think you need to give the new guy something more to do than continue the strategies that got you where you are today.
Remember when applications servers and portals were major strategic differentiators, back all of four years ago? Now companies like SAP give them away. The bottom line is that software technology is like fast food -- when a hamburger, fries and a Coke costs $2.39, most consumers will ignore the fact that it's not so healthy and opt for something that's filling, cheap and replete with good, if totally artificial, flavor.
And like fast food, what differentiates in rapidly commoditizing markets is sales, marketing, and brand. These are all things that, when it comes to software, Sun hasn't shined at. Sun's erstwhile competitors in software technology -- Microsoft, IBM, BEA, even the Open Source movement -- have all out-marketed, out-sold, and out-branded Sun for years.
Even if the alternatives are less nutritious, Sun has always had trouble staying ahead of the commoditization curve in software technology.
Ironically, there's one place in the software world where Sun was once positioned for major brand awareness, and that was in enterprise software. Back in the late 1990's, as SAP, Oracle, and PeopleSoft were forging their leadership positions, the inside consensus was that Sun servers were the best platforms for running high-availability ERP systems. This was internal scuttlebutt only, because HP and IBM had forged strong marketing alliances and were pushing their respective Unix servers heavily into these markets.
Sun's response to this opportunity was, to say the least, underwhelming. And Sun's position as the best hardware vendor for the ERP market became an industry secret that was, eventually, completely forgotten.
The point is that the enterprise software market does a relatively good job of staying ahead of the commodity curve. Enterprise software, when it combines vertical functionality and deep business expertise, is by definition commodity-proof, at least for long enough to make a difference in a vendor's bottom line. And enterprise software does so in part by helping to commoditize other sectors of the software market.
Hence the presence of apps servers, portals, integration services, and the like in SAP's software stack. It's no coincidence that much of what SAP includes as a loss-leader for its applications sales are pieces of technology that Sun has been hoping, vainly, would help it become a software powerhouse.
So, Scott, it's time to get real about enterprise software. Which means getting real about moving out of the commodity stack and into the value-added side of the equation.
Here's my advice: take that money you just got from Microsoft and go spend it on enterprise software. Buy some applications, acquire the service companies that can implement them, and start owning some of the Java solutions that everyone else is building on your dime.
There's no alternative but to get on the enterprise software bandwagon. Or I'll be writing this same column two years from now. Only this time it will be an epitaph.