WOW - This Is Grrrreat - Lead Story on CNNfn.com This Morning
Sun Wants To Be The Dot - Sun Microsystems Stands To Profit As The Middleman For E-commerce
Special: CNNfn at World Economic Forum
January 31, 1999: 9:01 a.m. ET
DAVOS, Switzerland (CNNfn) - Scott McNealy doesn't want to sell books on the Internet. And he doesn't want to hawk CD's either. But make no mistake about it. If someone's doing business on the World Wide Web, McNealy and Sun Microsystems Inc. want a piece of it.
As one of the leading providers of computer servers -- the powerful, faceless machines that allow people to browse the Web -- Sun is angling to be the place people turn to when they want to set up a "dot.com" address. "When companies want to create their online presence, what we're trying to say is we're that little piece in there that makes it happen," McNealy said in an interview with CNNfn at the World Economic Forum Sunday.
"Without the dot it doesn't happen. We're the dot. We're the way you get on the Internet. I never really thought about it that much but the whole effort is to affiliate ourselves with companies that want to dot com their companies. We've kind of made a verb out of dot com."
Indeed, with the pending acquisition of Netscape Communications Corp. (NSCP) by America Online Inc. (AOL), Sun stands to become an even bigger force in the world of electronic commerce through AOL's agreement to support Sun's Java programming language and Sun's access to Netscape's powerful suite of e-commerce applications "We've become the arms supplier for service providers and corporations who want to help people put up shop on the Internet," McNealy said, adding Sun (SUNW) can provide everything from servers to operating systems. "We're the way in which the Netscape products can safely and comfortably reach all of AOL's competitors. That's really why we were brought into the deal."
A jolt of Java. Much of Sun's success can be attributed to Java, the programming language that allows the same software to run on different operating systems. With Java, computer users can keep in touch with the office when they're on the road, read and send e-mail from their pocket pagers and check their stock portfolios. McNealy said Sun also hopes to use Java technology to bring a whole new array of appliances to consumers, ranging from set-top boxes that allow viewers to browse the web on their television sets to so-called smart cards that can be used for home banking, bill paying and stock market orders.
"What Lucent is to dial-tone, we want to be to...mail tone, web tone, e-commerce tone, all the new digital tones," McNealy said. At the same time, Sun is hoping the growing popularity of Java will finally push the personal computer off the desk. "Computers belong in the boiler room, appliances belong in your hand," McNealy said, elaborating on a long-held position that personal computers should be regarded as nothing more than telephone switches.
That argument is aimed squarely at Microsoft Corp., (MSFT) the world's largest software maker and Sun's biggest rival. Sun would like nothing better than to make Microsoft's vaunted Windows operating system, which is used on more than 80 percent of the world's personal computers, obsolete. Needless to say, Microsoft is pushing hard to make sure that doesn't happen. In response, the Redmond, Wash.-based software firm is going after Sun's bread-and-butter server business with the Windows NT operating system, which when combined with Intel Corp.'s speedy processors, offer a formidable alternative to Sun's servers.
Next year, the competition will only get tougher when Microsoft releases a new version of Windows NT. But McNealy said he's not losing sleep over Windows NT, noting the software has some 40 million lines of code. "Forty million lines of code," he said. "There wasn't that much code on the planet a while back. And they're going to put that on every desktop and every server? I don't think so. The new version of NT is Solaris 93," he said referring to Sun's software. But Sun is not discounting Microsoft, and its chief executive, Bill Gates, completely. "The guy has enough money to buy us personally at a huge
premium and still have gazillions of dollars left over," he said. "Wouldn't you be worried. I'm mean we're ground zero from their perspective. We run anxious. They're the competitor. There really isn't anyone else."
E-commerce winners and losers. As for who will win the e-commerce war, McNealy said some players will obviously fare better than others, noting Amazon.com, the Seattle-based book and music retailer, has shown the Internet is a popular place to buy and sell merchandise. "They've made it so easy to buy books," he said. "You buy books when you normally would have bought flowers or candy or something else. It's actually incremental demand, it isn't like bookstores are going out of business, people are buying more books."
And the best part about Amazon's success is Sun, and its servers, are the dot in Amazon.com.
by senior producer Jerry Dubrowski |
