Value of Design

Last week, we joined our friends at Intel at their Intel Developer Forum, to unveil the second generation of our Systems platforms. A few of our folks from the event took photos with their phones and sent them my way.

A few evenings later, I was at a dinner presentation with about 30 CIO's - one of whom had seen some of the IDF coverage. The customer (who does no business with Sun currently) asked me, "why should we bother talking to you? How can you possibly differentiate - it's all a commodity to me."

This is one of our biggest opportunities - and biggest challenges. But not as you might think. Most of the world doesn't do business with Sun - that's the good news. That's also the challenge - how do we reach customers when we don't have a pre-existing purchasing relationship based on PC procurement (like our peers)? On a global basis, it's a tough nut to crack (and no, it's not as simple as "Just advertise on TV!").

So this was the picture I showed during my presentation - see any difference between our system (codename, Tucani, real name, x4450) and the others? (Answer: we're half the size - the power and performance difference is admittedly harder to see in a picture.) If your business or datacenter's in a place where space, power density or performance is at a premium, we'd be pleased to engage - running, of course, Windows, VMware, Linux and Solaris.

Step one of reaching new customers is being better by design - and fueling word of mouth. After all, the internet reaches more people than a television.

(And for the technical among you, what's shown is our first four socket Caneland system, with 32 Dimms, 6 PCI-Express slots, built in RAID, up to 8 hot swap disks, redundant power & cooling, full remote systems management... all in 2U). Read more here and here. Also available as a two socket/1U platform...)

Posted on 09:00AM Sep 25, 2007 | Comments[46]

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Are You Serious? (Sun Partnering with Microsoft)

Last week, we signed a deal with Microsoft. Remain calm.

The good news is everyone paid attention. The bad news is it spawned a lot of questions - which I thought I'd answer here.

The announcement was this: Microsoft will be supporting Project Virginia, Sun's soon-to-be-announced hypervisor platform - meaning we can consolidate and manage Windows (alongside Linux and Solaris). Secondly, Sun will support Windows virtualization - allowing Windows to do the same for Solaris. And finally, Sun agreed to package and support (or 'OEM') Windows for customers and partners that want to buy direct from Sun.

A few folks have suggested this announcement (reminiscent of a change in our ticker symbol) represents a dramatic shift in our strategy, and that my statue will thus never grace the marbled lobby of the Free Software Foundation. The former's obviously not the case (the latter may be), so I figured I'd offer a little more background.

First, as recently as two years ago, Sun was a non-player in the x64 server space. Customers that wanted to run Solaris on non-Sun hardware couldn't, and those that wanted to buy x64 systems from Sun couldn't. Partners couldn't sell either solution, and when the industry rankings were published, we kept showing up in the "UNIX" or "proprietary" categories (ridiculous monikers, both).

We knew we wanted Solaris and our Systems business to grow beyond their own boundaries - we wanted customers to buy Systems from us, even if they weren't running Solaris; and for them to buy Solaris, even if they weren't running it on a Sun System. (If you think about both businesses as intersecting sets in a Venn diagram, the best way to grow the intersection isn't to jam the businesses together, it's to grow the sets.) Day 1, everyone wanted to know, "Are you guys serious?" - that question was our number one impediment to selling.

Now, we started our x64 relationship with AMD - optimizing our software and systems to scream on their Opteron platform. But rather than taking on the planet, we focused our efforts on customers and markets where we could bring our engineering and design prowess to bear - mission critical, scaled computing. We didn't touch tower servers, we avoided focusing on dentist's offices and corner shoe shops. We focused on systems like these, and customers like these. And we started winning deals. Big deals. Running Solaris and Linux, sure, but also Exchange, SQL Server and Microsoft's IPTV stack.

As time progressed, we expanded our work to include Intel's offerings, and similarly sharpened Solaris on our, and others' Intel platforms. We fueled performance and started driving advances that grew the market for us and the community. Questions surrounding "But are you guys serious?" started falling away. We were serious. Deadly serious, and now everyone knew it.

In a world that lacked differentiation, we differentiated via design. Led by Andy Bechtolsheim and John Fowler's team, we delivered measurably better performance, density, efficiency, along with better integrated management and serviceability. Our current lineup now completely integrates our SPARC and x64 systems and supply chains - so when you a blade system (as shown here) from us, for example, you can intermingle SPARC, AMD and Intel blades, manage them all identically, while running Linux, Solaris and Windows - under Project Virginia as well as VMWare's offerings. We can serve 100% of the market (which is why we're so focused - it's easy to get distracted with a market this big). Like I said, our products focus on design innovation.

Net result? We've been moving up in both operating system and x64 server rankings. Every year, inch by inch, dollar by dollar, RU (rack unit) by RU. We're now the fifth largest x64 vendor in the marketplace - with a billion dollar annual runrate (as of our last reported quarter). That's quite a ways up from "invisible" two years ago. Solaris is on a similar tear (watchful analysts have even started tracking it separate from our hardware) - and that's before we launch Virginia.

And although we've built a billion dollar annual runrate in the x64 business, we still hear objections - the biggest? "Your competition says you're not serious about Windows." Now of course, that's just silly - SQL Server screams on products like our x4500. In fact, we're the foundation behind one of the biggest Windows deployments in the US at AT&T (supporting their Microsoft IPTV rollout). We do a ton of business on Windows - with both hardware and software (by definition, most Java developers are on Windows, and it's always been a part of our software focus).

But now it's time to open ourselves up to the entire market, to take the last objections off the table. So we got together with Microsoft to ink a new relationship, through which two things will happen.

First, Microsoft will certify Windows running within Sun's Project Virginia. Customers and partners looking to consolidate and virtualize Windows instances can safely do that under Sun's offering. This is a big deal for us, and extends Sun's reach beyond Linux and Solaris into the Windows domain. Secondly, we'll reciprocate - and support Solaris via Windows virtualization. Customers have more choice - and to be clear, we are committed to doing everything (everything) at Sun in the free software community (even without a statue). This agreement does nothing to change that.

Second, Sun will OEM and support the Windows platform. We'll be bundling our Java runtime environment, our tool chain, and our Java Enterprise System middleware (and the OpenOffice suite for good measure) in the Windows we distribute. So customers and partners can now buy directly from Sun. I've heard from a number of both since we signed this deal saying how excited they are - they can now consolidate a lot more business on Sun. That's what we wanted. And our competitors have to take a slide out of their presentations (the one that says "Buy from us, because Sun isn't serious about Windows.").

So do I think this deal is good for Sun? Absolutely - it opens more opportunity, puts our past behind us, and gets everyone focused on Sun's virtualization, Solaris and Sun's Systems portfolio - independently. Does it signal a strategic shift inside of Sun? No - we can walk and chew gum at the same time. Running, virtualizing and supporting Windows opens doors.

So are we serious? About virtualizing Windows? About being a good OEM partner to Microsoft customers? About running Solaris on all volume hardware? About being a cross platform software company? A major force in datacenter design? The world's largest corporate contributor to free software?

Why, yes.

Next question.

(And for those wondering why we didn't talk about this at our analyst event a couple weeks ago, the deal wasn't done - and random acts of messaging seldom help progress a relationship. Sometimes they do, but not this time around.)

(Update: wanted to add our latest Glassfish news...)

Posted on 10:30PM Sep 16, 2007 | Comments[71]

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The Continuing Rise of OpenOffice.org

The technology landscape shifted again yesterday, with another announcement between Sun and IBM - IBM has joined the OpenOffice.org community. Bluntly put, with only one (rather unlikely) exception, there is no more credible enterprise partner for OpenOffice.org than IBM. This is a big accomplishment for both teams - congratulations, folks.

At the risk of repetition... why are we (both) interested? Do we really believe the growing OpenOffice population will have an impact on the world's datacenters (where both of us make our living)? Obviously, yes.

The technology choices consumers make are already having a profound impact on how business runs. As an example, with 70% of the US economy driven by consumer spending (among the highest in the world) - when consumers spend, they are increasingly spending via the network. Using the devices, software and services they've chosen. Do I expect them to buy a datacenter through OpenOffice? No.

The choices consumers make, given their numbers on the web (here and around the world - in population centers, of course) are driving standards, from time-based video to applications and document standards. The technology industry is no longer the sole driving force - consumers are increasingly in charge. In the developed and developing world.

So our theory is simple. Free software, like free search or video, appeals to the broadest segment of the world's population - free is a universally attractive price tag (and a critically important intellectual property philosophy). One need only look to the recent successes behind the global rise of the ISO Standardized Open Document Format - appealing because of its price tag ($0), its complete freedom from tricky royalty, patent or technology obligations, and the ubiquity of products that support it (like OpenOffice, Google Apps, and others).

So what's driving OpenOffice adoption? Sun's endorsement? IBM's involvement? Google's support? Ubuntu's popularity? Its global community is enormously important, for sure.

But let me put it this way. I was with the CEO of a very popular internet software company recently, who said she felt it necessary to get her company's core product download to under 5 megabytes. I asked why- at more than ten times that size, OpenOffice downloads seemed in no danger of slowing globally, even to places with poor network infrastructure. Her response?

"My download doesn't save a customer $400." There you have it.

So get OpenOffice here, and tell your friends - if they'd like Microsoft Office compatible office productivity software, at home or at work or at school, they can get it.

Free.

In all the right senses of that word.

Posted on 08:47AM Sep 11, 2007 | Comments[58]

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Thank You, Network Appliance

We held an investor and analyst conference today in New York City. All in all, a very positive day, lots of momentum and enthusiasm for where we're headed (and apprecation for the progress we've made - new product launches, and all).

In one of my first investor calls after the event, a large shareholder surprised me though, with, "why do you think NetApps is trying to kill off ZFS?" Er... what? I was totally stunned - it was the first I'd heard that Network Appliance was suing Sun.

My first response was that NetApps probably needs to read this post carefully - talking about the futility of litigation as a mechanism for proprietary companies to stifle the rise of open source competition.

Now having had a chance to read some of the statements their CEO made, here are some updates.

First, Sun did not approach NetApps about licensing any of Sun's patents and never filed complaints against NetApps or demanded anything. ]

NetApps first approached StorageTek behind the cover of a third party intermediary (yes, it sounds weird, doesn't it?) seeking to purchase STK patents. After Sun acquired STK, we were not willing to sell the patents, We've always been willing to license them. But instead of engaging in licensing discussions, NetApp decided to file a suit to invalidate them. To be clear, we never filed a complaint or threatened to do so, nor did anyone, to the best of my knowledge, in the ZFS community.

We're all focused on innovation and winning customers, not litigation.

Second, a word on patents - we use our patent portfolio to protect communities, and indemnify customers - you need only look back to our settlement with Kodak when they attacked the Java community. (That case was heard in Rochester, New York, Kodak's home town, which is a tad different than the East Texas venue Net App appears to have chosen.)

Finally, and perhaps most importantly (again, read here for why), I'd like to thank our friends at NetApps for ensuring every single customer in their installed base is aware of the outstanding economics offered by ZFS as a file system and storage virtualization platform. Please feel free to (learn more here) and get a free trial Thumper storage device here. At $1.50 per gigabyte - open source storage is about a third the price of competitive offerings, with better performance.

And Sun indemnifies its customers, so I'd encourage all interested parties to compare the economics of ZFS and Thumper to what you're currently forced to pay - the savings are absolutely shocking.

The rise of the open source community cannot be stifled by proprietary vendors. I guess not everyone's learned that lesson.

Posted on 05:00AM Sep 06, 2007 | Comments[59]

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Congratulations, Michael.

I had an opportunity to have lunch with the newly elected president of my alma mater (Wesleyan University) recently, a fellow named Michael Roth. He was a really impressive individual, committed to leading an institution that changed my life (as educational institutions so often do).

I was really pleased to get a note from him yesterday morning saying he'd started to engage the Wesleyan community, here - I don't know if he's the first university president to use a blog, but he's certainly the first leader at Wesleyan to do so, and unique among his peers in stepping forward.

From where I sit, it's better to lead from the front, than from behind a closed door.

So congratulations, Michael...

Posted on 01:45PM Sep 01, 2007 | Comments[21]

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