Different Isn't Always Better, But Better's Always Different

I've read the comments from my last entry - and wanted to make sure to respond to some of the points.

First, I knew ahead of time changing a ticker to which a generation had become accustomed would be hard. And that it'd draw out the cynics (or those whose only memory of the Java platform persists from the its awkward (and slow) beginnings).

We've been driving a lot of changes recently, and change is hard. Every decision has adherents and detractors (from moving to free software, to signing deals with former competitors - even getting rid of styrofoam in our cafeteria). Change is also the primary ingredient in progress. I'm committed to our decision - our ticker, and one of the highest volume equities on NASDAQ, is now JAVA. (And in response to the obvious question, the symbol SUN was unavailable, and plenty of companies name their ticker after their highest value brand, COKE among them.)

To respond to some of what I've read, here and elsewhere... do I expect a ticker change to have any impact on our share price - to be clear, none. No rational investor would buy on a ticker symbol. Investors buy on financial results or expectations (or trading patterns).

I do expect the change to drive greater awareness of the Java brand (something every Java partner has asked us for, for years), more dialog surrounding the role of Java as not just a language, but as a platform (for Ruby, Python, and other scripting languages supported on the Java Virtual Machine), and greater affinity with its inventor (Sun). How will it drive affinity? The picture below gives you just one idea - this was published globally after the market's close on Monday (and continues to be referenced when Sun is now referenced).

With all that said, my last entry stirred up a lot of comments and emails.

Thus far, my favorite (good natured) rants have come from a few individuals annoyed that their tattoos and license plates (one shown above) are now out of date; a herd of (less good natured) system administrators who threatened class action (and bodily harm) if we changed our software naming conventions (Sun software updates or packages start with the filename prefix "SUNW" - there is no plan whatever to change that - to be clear, no plan - so please, stand down!); and those that believed changing our ticker symbol cost jobs and money (the change was free to Sun - moreover, NASDAQ loves it and the Java platform so much we're working together on ways of promoting JAVA - which creates, rather than destroys, opportunity).

I've also gotten about 20, "I was on a [bus in Nepal/boat off Guam/beach in Finland/cofee shop in Vietnam, etc.] and the [driver/passenger/student/barkeep] said she knew Java but not Sun..." emails - which were generally far more supportive of the change.

Am I worried that the Java platform may not last forever (should you put it on your license plate :-) ? No. It's the single most pervasive technology Sun has ever invented - and the most valuable brand we've ever built. It's one of the few technologies that may outlast the century. I'm not worried about its permanence. Should you infer any change in strategy from the change? None, it was, purely and simply, an opportunity we didn't want to let pass.

So I appreciate the comments - not all of them were unexpected, and we'd taken most (if not all) of the issues to heart before moving forward. And I still believe it's the right answer for Sun in the long run. Time will tell.

For those interested in the history of Java's naming, I asked James Gosling, Java's inventor, for his recollection. Here's his response...

__________________________________________________________

Begin forwarded message:

From: James Gosling
Date: August 24, 2007 8:16:58 PM PDT
To: Jonathan Schwartz
Subject: How was Java named?

The story goes like this:

We needed a name. We had been using "oak" (which was selected essentially randomly by me), and while the team had grown attached to it, the trademark lawyers ruled it out. We had lots of email debates about names, but nothing got resolved. We ended up in the awkward position where the #1 thing stopping us from shipping was the name.

Our marketing lead knew someone who was a "naming consultant" (I don't remember his name, but he was great). We could neither afford the price nor the time of a conventional product naming process. He agreed to do something rather odd, but effective and quick: he acted as a facilitator at a meeting where about a dozen of us locked ourselves in a room for an afternoon. He started asking us questions like "How does this thing make you feel?" (Excited!) "What else makes you feel that way?" (Java!) We ended up with a board covered with essentially random words. Then he put us through a sorting process where we ended up with a ranking of the names. We ended up with a dozen name candidates and sent them off to the lawyers: they worked down the list until they hit one that cleared their search. "Java" was the fourth name on the list. The first name on the list was "Silk", which I hated but everyone else liked. My favorite was "Lyric", the third one on the list, but it didn't pass the lawyers test. I don't remember what the other candidate names where.

So, who named Java? Marketing organized the meeting, the consultant ran it, and a whole pile of us did a lot of yelling out of random words. I'm honestly not real sure who said "Java" first, but I'm pretty sure it was Mark Opperman.

There certainly wasn't any brilliant marketing mind who went through a coherent thought process.

________________________________

As with a lot of innovation, not every decision - nor product name, blog or line of code - starts on a spreadsheet. Opportunity's often far harder to measure.

Posted on 11:45PM Aug 30, 2007 | Comments[52]

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The Rise of JAVA - The Retirement of SUNW

I've spoken before about the value of brand - this post is a good example. And I wanted to follow up with a few more thoughts, and an important shift in how Sun (NASDAQ:SUNW) presents itself to the world - and more importantly, how the world now presents itself to Sun.

Sun is blessed to have built two of the best known brands on the internet. The Java brand, and OpenOffice (and its cousin, StarOffice).

Presumably, you saw the relationship we just announced with Google (NASDAQ:GOOG), in which they'll be distributing StarOffice for free as a part of their Google Pack offerings - to put this in context, we're now distributing multiple millions of copies of OpenOffice every week (and that's before you count mirror distribution sites). The combined volumes of StarOffice and OpenOffice generate a user and developer community now accelerating well past a hundred million users - across developing economies, developing companies, and across Windows, Solaris, Linux and the Mac OS. As a software product and a brand (all end user software is ultimately both, after all), growing distribution drives opportunity and awareness for everyone involved - for the OpenOffice/StarOffice user and developer community, and as its shepherd on the network, for Sun.

Wherever OpenOffice and StarOffice travel, more users know and trust Sun - what's that brand or awareness worth, especially among tomorrow's decision makers? It's hard to know exactly, but I'd bet more people know Sun via OpenOffice than know us through datatcenters. That's an astonishing assertion, but with the internet now reaching billions of end users, the number of consumers on the internet dwarfs the number of IT professionals. The numbers are staggering.

But with that said, compared to the Java platform, office productivity is relatively esoteric stuff.

Because Java touches nearly everyone - everyone - who touches the internet. Hundreds of millions of users see Java, and its ubiquitous logo, every day. On PC's, mobile phones, game consoles - you name it, wherever the network travels, the odds are good Java's powering a portion of the experience.

What's that distribution and awareness worth to us? It's hard to say - brands, like employees, aren't expenses, they're investments. Measuring their value is more art than science. But there's no doubt in my mind more people know Java than Sun Microsystems. There's similarly no doubt they know Java more than nearly any other brand on the internet.

I know that sounds audacious, but wherever I travel in the world, I'm reminded of just how broad the opportunity has become, and how pervasively the technology and brand have been deployed. Java truly is everywhere.

Ask a teenager if they know Java, and they'll point to their favorite mobile applications, the video uploader for their social network, or their game console. As for working professionals, I had dinner with a financial analyst a few months ago who said he saw the Java launch experience "a few times a day" when accessing intranet applications - as did tens of thousands of his fellow employees. Daily. Global companies like Google and eBay (and Vodafone and Citigroup) are built on Java, every major PC manufacturer bundles Java upon shipment, as does every mobile phone manufacturer, and tens of millions of developers touch it every day in the world's IT shops. Students learn it to get college credits for computer science, and there are more Java courses on university campuses than we ever imagined. Wherever it goes, Java brings limitless opportunity - to Sun, and to our partners that develop, use or deploy it.

So what's that awareness worth? Ask the question a different way - if we wanted to buy that exposure, to touch tens if not hundreds of millions of consumers every single day of the year, across nearly every continent, industry, geography and demographic - what would it cost us? (If you're in the industry, just do the CPM calculus - the Java launch experience is one of the most pervasively viewed exposures on earth.)

As I said, the number of people who know Java swamps the number of people who know Sun. Or SUNW, the symbol under which Sun Microsystems, Inc. equity is traded on the NASDAQ stock exchange. SUNW certainly has some nostalgic value - it stands for "Stanford University Network Workstation," and heralds back to Sun's cherished roots (in academia). Granted, lots of folks on Wall Street know SUNW, given its status as among the most highly traded stocks in the world (the SUNW symbol shows up daily in the listings of most highly traded securities).

But SUNW represents the past, and its not without a nostalgic nod that we've decided to look ahead.

JAVA is a technology whose value is near infinite to the internet, and a brand that's inseparably a part of Sun (and our profitability). And so next week, we're going to embrace that reality by changing our trading symbol, from SUNW to JAVA. This is a big change for us, capitalizing on the extraordinary affinity our teams have invested to build, introducing Sun to new investors, developers and consumers. Most know Java, few know Sun - we can bring the two one step closer.

To be very clear, this isn't about changing the company name or focus - we are Sun, we are a systems company, and we will always be a derivative of the students that created us, Stanford University Network is here to stay. But we are no longer simply a workstation company, nor a company whose products can be limited by one category - and Java does a better job of capturing exactly that sentiment than any other four letter symbol. Java means limitless opportunity - for our software, systems, storage, service and microelectronics businesses. And for the open source communities we shepherd. What a perfect ticker.

And if you wondered why we picked eight strokes for the Java logo, now you know one reason...

Posted on 09:00AM Aug 23, 2007 | Comments[364]

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Momentous Day for Solaris

As many are already aware, we embarked upon a journey a couple years ago to formally separate the Solaris operating system from Sun's hardware business - as well as bring Solaris to the free and open source software world via a community effort named OpenSolaris. None of these changes were easy, but I'd like to believe both were successful. What's my proof?

By now, you've seen the news that Sun and IBM have struck a deal to support Solaris on IBM hardware.

Words alone cannot describe how great it feels to type that sentence. In fact, I think I'll type it again.

By now, you've seen the news that Sun and IBM have struck a deal to support Solaris on IBM hardware.

Through the relationship, IBM will become a Solaris OEM, and will resell subscriptions on their System X and BladeCenter hardware - in addition, we'll both work on optimizations for drivers and system performance, and collaborate to serve customers that want choice. (As I said to a journalist today after the announcement, vendors that don't offer choice can only serve customers that don't want choice... while IBM and Sun can serve the rest.)

To me, this is a tectonic shift in the marketplace - bringing together erstwhile competitors to serve a marketplace IBM and Sun agree is bigger than the both of us. By working together, we can serve customers wanting to run Solaris on IBM hardware, and deliver a unique set of solutions (including IBM's middleware, the majority of which is certified on Solaris, too). This isn't about displacing partners or revenue streams, it's about growing both - and as the first Tier 1 x86 system vendor to sign on as a comprehensive Solaris OEM, IBM is clearly in the pole position to capture that growth.

Does this change the world? Answering for Sun, I think yes - it does. The announcement validates what we've been saying all along - the momentum around Solaris as a cross platform, open source operating system is indisputable. Driven by integrated virtualization, extreme performance, the integrity of the open source OpenSolaris community, and most of all... driven by tons of new developers and customers, across the world, building new solutions and businesses on the web.

We've also said, all along, that a groundswell of developer adoption is the best leading indicator of commercial opportunities - for us, our developers and partners. This relationship puts that debate to rest.

So thank you, IBM - we're looking forward to working together. We couldn't be more excited (but that was probably obvious). A world of opportunity awaits us both...

Posted on 01:42PM Aug 16, 2007 | Comments[62]

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CTO Makeover in Second Life

A while back, we did some simple math on launch events at Sun - we spent a ton of money, got 500 - 1000 invited guests into the audience, and missed most of the planet. By definition, our marketplace can't fit into a single room. So we began streaming our launch events via the web.

Lo and behold, when we counted our web audience, the numbers were staggering - we were reaching 100,000's of people. So we took the money we were otherwise spending on launch events in luxury hotels, and moved it to improve the global web experience - the chandeliers weren't quite as fancy, but we wanted the audience focused on content, not crystal.

So for those interested in viewing our Niagara 2 launch event, follow this link, and take a look at the video casts (they're broken into chapters for digestability).

For the truly technical, take a look at the 3rd chapter, in which Rick Hetherington, CTO for our Microelectronics team appears in Second Life (looking fit and stylish, the hallmark of a Sun CTO) to fly the audience through the microprocessor and its core technical specifications.

All kidding aside, we used Second Life to provide a visual overview for the audience of how Niagara 2 is built - it was remarkably effective... (again, videos are here.)

And speaking of reaching a global audience, we just announced we're bringing our Startup Essentials program to India and China. Startup Essentials targets small and young companies with some of the most aggressive discounts we offer on hardware systems (remember, the software's already free) - more info here.

Posted on 02:07AM Aug 09, 2007 | Comments[31]

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Sun Enters the Commodity Silicon Business

We're announcing the fastest microprocessor we've ever shipped this week - delivering 89.6 Ghz of parallel computing power on a single chip - running standard Java applications and open source OS's. Simultaneously, we've said we're entering the commodity marketplace, and opening the chip up to our competition. It's probably worth explaining.

I've made the following statement before, but it bears repeating - what do banks, oil companies, and telecom operators all have in common?

They represent some of the largest industries on earth, yield some of the wealthiest companies, and are all oriented around monetizing... commodities. Commodity markets are the largest and most valuable on earth (despite those who seem to think they have no value).

Commodities are defined by goods or services in near perpetual, universal demand. Like financial services, oil, and network access (and increasingly, internet search and water, both vital ingredients for life as we know it in Silicon Valley).

In my view, computing is also a commodity - as is storage and networking. They're all in demand globally - and the market's growing (especially in the developing world).

Now, companies that do well in commodity markets don't do so exclusively on price. They differentiate via R&D. In fact, the industries I mention above are among the world's largest investors in R&D - oil companies, banks, telcos and network service companies all have mammoth technology budgets. As does the technology industry (at Sun, we invest nearly $2,000,000,000 (billion) a year on R&D).

Why do we invest? To differentiate, of course.

So when we announce (via this webcast) the fastest microprocessor the industry's ever seen (the benchmarks are staggering) - and say we're entering the "commodity microprocessor market," what does it really mean? It means we're no longer limiting ourselves to serving an internal market, inside Sun. Instead, we're opening ourselves up to the broadest market possible - where the opportunity's largest.

Despite having what's arguably the single biggest competitive advantage our systems business has ever had, we've separated out our microelectronics business - and told them to win on the open market, as well. We signed our first OEM agreement with Marvell, through which we'll be collaborating to take our networking advancements to the marketplace. More broadly, our microelectronics team is free to sell to our competition. For the record, we'd be thrilled to supply, for example, a Niagara blade to HP or IBM for their blade servers - as well as to the larger market of networking, storage, automotive and industrial applications. It's a commodity market, after all - vast, growing, and in search of differentiation.

You'll recall we followed this path with our software business - decoupling Solaris from its exclusive focus on Sun hardware. That experience validated the obvious: the market for Sun's innovation is always larger outside of Sun, than inside. When we opened ourselves to the market, our business grew faster (Software grew 13%, year over year, faster than Sun overall). Now we're following that path with our microelectronics business.

To add fuel to the fire, the blueprints for our UltraSPARC T2 (I personally like the moniker, "Niagara 2" - named after Niagara Falls, btw, and the great volumes of water that pass over them), the core design files and test suites, will be available to the open source community, via its most popular license: the GPL. Making Niagara 2 the only commodity silicon whose core designs are available to the open source community - whose strength, and market power, only grows by the day.

These are all huge changes to our business. Driven by a simple philosophy: the open market is bigger than any internal one. But ultimately, why now? A simple reason: because customers building infrastructure for the internet have been asking us to do so. And they've all basically said the same thing - in building their own internet infrastructure, from telecom equipment to consumer devices, they want commodity economics without commodity performance.

Stay tuned for more details.

In the interim, on Monday a reporter accidentally violated our news embargo, which set off a flurry of press coverage. I have to admit my favorite part of the day was reading a quote from a few of our (hopefully erstwhile) competitors - who referred to the internet as a "niche." Hmm...

Posted on 08:30AM Aug 07, 2007 | Comments[48]

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Sun, Solaris and Bundled Virtualization

When we double the speed of our computers, our customers don't buy half as many, they tend to buy twice as many. Hold that thought.

I was with a variety of external audiences yesterday - our business results stirred up some questions, partially based on comments we made about virtualization's impact on the quarter. Which I thought I'd clarify in a quick note, before a broader summary next week.

I'd like to go on record saying virtualization is good for the technology industry - which seems to be counterintuitive. The general fear is that technologies like Solaris 10 or VMware that help people squeeze more work from the systems they already own is somehow bad for Sun. In my view, quite the opposite is true.

As I said, when we double the speed of our computers, people don't buy half as many - they tend to buy twice as many. To companies that see information technology as a weapon (that's not everyone, btw), increasing the power of the arsenal without increasing its price incents more purchases, not less. The same applies to efficiency - a computer in use only half the day is less valuable than one used throughout the day. The objective of virtualization is to increase the level of utilization in pursuit of more value, efficiency and affordability.

And that's exactly the theory behind the newly bundled virtualization features in Solaris 10 - from Xen to ZFS, Crossbow to Java (fancy names for the same idea - reducing complexity to increase productivity). Solaris 10's virtualization enables customers to consolidate the sprawling Linux, Solaris and Windows boxes laying around their datacenters, without having to pay exorbitant software licenses for add-on products. We built virtualization in to Solaris 10 not to encourage fewer computer or storage purchases, but instead, more - systems that are twice as utilized are twice as affordable. (When you double the mileage of a car, more people can afford it.)

What impact did those features have on Sun during Q4? When you use Solaris to consolidate lots of small, poorly utilized computers, into a smaller number of bigger computers, you may depress unit volumes. But you bulk up the configurations of the systems you sell (more memory, more cores and threads, more storage, etc.). That's exactly what we saw in Q4 - fewer, but more richly configured systems, and not just at Sun. But at HP, Dell and IBM, too.

Why? Because Solaris 10 is now running like a champ on their hardware, as well. It's being used to consolidate Solaris, Linux - and with this release of OpenSolaris, Microsoft's Windows, as well. (You can get more info here.

As an integrated feature in the operating system.

Because this is all about efficiency - and the most efficient virtualization solution is the one you didn't have to pay extra to use.

Posted on 08:00AM Aug 01, 2007 | Comments[31]

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