Wednesday, October 22, 2008

What should Sun Microsystems do for financial recovery?

"Sun Microsystems swings to big quarterly loss (AP)"

As years of follower of Sun, and recommender of Java, I felt that I must write down some advices to Sun before it is too late. This list is just a sample look from enterprise world:

1- Find a way to earn money from Java efforts: I think Sun is the last company earning money from the Java. As Java had gone to mainstream, many companies earned lots of money, but Sun never succeeded to be a market leader in any product. For example application server market, or development tools, we never used theses products since those were not the best choices. Sun’s Java success could not bring to product portfolio resulting today’s poor software revenue. Sun continuously spends money to Java community with platform technologies, language improvements, JCP, Java One etc. with no feasible ROI. Server hardware market is narrowing since Microsoft or Linux server is dominating market day by day.

2- Open source contribution must turn into a revenue stream: Other big vendors are investing on open source to keep developers on their own stack. Community edition is provided with value-added commercial option with the aim of future sales. Or strong professional services are provided that results indirect income from free products. If revenue model is not seriously set and measured, this is going to be another pitfall for Sun. But I am suspicious about open source ROI for Sun.

3- Find a way to enter Enterprise space: Large-scale businesses are not adequate and mid-size companies should be targeted. Java entered into Enterprise space but we see other players not the Sun. To enter an enterprise, you have to provide at least one of these products; Hardware, OS, DBMS, ERP, Application Server. Other products are not enough to capture enterprise space, because these products are at the top priority in any IT project. I think the next step after DBMS (MySQL) is ERP.

For Java’s long-term success, financial health of Sun Microsystems is important. Financial health is the result of right strategies used at the right time.

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