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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: alydar who wrote (59281)	3/8/2004 7:08:52 PM
From: Lizzie Tudor	Respond to of 64865

well I think oracle is in a world of hurt due to open source. Friendster which some think is the hottest internet startup runs on MySQL, no Oracle.

To: alydar who wrote (59281)	3/8/2004 8:15:11 PM
From: E_K_S	Read Replies (1) \| Respond to of 64865

Good summary blisenko - I like the way IBM is moving their ship slow but steady. Sunw has followed IBM's approach in trying to generate new service revenues, adopt a new revenue stream from their software business and basically sell their hardware (at commodity prices) giving up large margins in order to obtain software and service (reoccurring) revenues. The problem with SUNW is that they have not proven that their model works. IBM's model works and they continue to grow their business especially in the service revenue category. How Oracle plays in this is that SUNW is more reliant on Oracle's performance than IBM. Sunw generates more revenue from Oracle installations (using SUNW hardware systems) than IBM which uses many of their own proprietary software applications. My take on this is the enterprise customer wants solutions at an affordable cost. SUNW has the means to provide these solutions with their current product offerings on their own but the enterprise customer may eventually find that SUNW may not be the leader (and is loosing market share)and elect to choose systems from IBM or HP as their service provider of choice. We are not there yet but if the psychology "change" is there in the minds of our enterprise customers then SUNW will be battling an uphill climb (not good!). McNeally can offer "special" deals only so many times before it become moot. I think we are in the 7th inning and if the economy goes south then all bets are off. Maybe IBM will make an attractive offer to SUNW and we can again move this ship forward. Just some observations as we wind our way through this transition period. I continue to hold as you are correct that "the network" is the eventual solution for many of the larger accounts. Specifically, the SAN storage business should be the big gainer this year and SUNW had failed to show quarter to quarter growth in this business too. Sunw is worth $5 share if IBM buys them out and perhaps $8/share (or more) if they go it alone. The risk is if SUNW can make it alone or not in the next three to five years? EKS