Dropping profits and stock prices have analysts speculating that Sun could be a target for either acquisition or a restructuring in which the company would sell off parts of the business and focus on a smaller set of technologies. In a July 31 report, the 451 Group analyst firm raised the possibility of Sun being acquired: ‘Sun’s sunken stock price creates a relative bargain considering its roughly $4 billion cash on hand, sizeable intellectual property and patent portfolio, and of course, its respected technology and products’.
This is a highly speculative article that quotes various analysts’ thought about a possible acquisition of Sun. This year Sun went through a round of lay-offs (again) as a cost cutting measure, which makes me believe this is not a completely unthinkable scenario.
A remote chance of Microsoft acquiring Sun was also discussed in the article:
“A Microsoft-Sun merger or acquisition may have seemed unthinkable five years ago, but seems more possible since the two companies have been working increasingly closer following a court settlement and newfound friendship (forced by customer demand for interoperability in 2004),” Lyman wrote.
This doesn’t strike me as even a remote possibility.
Sun’s recent open sourcing of Solaris, Java and NetBeans makes it clear that Sun is more inclined toward OSS. Microsoft is a company that makes its money from selling software and not hardware. Donating money to Apache foundation is one thing, but rolling up the sleeves and getting their hands dirty in the open source arena is a whole another thing.
Even though Microsoft would like to see its Operating Systems running on Sun Servers I don’t think they’d want to start selling servers anytime soon.
Sun has made some of the wonderful innovations in the filed of Operating Systems (DTrace, ZFS, OpenSolaris etc) and Computing (Java). It’ll be sad to see them get bought out.
“Dropping profits and stock prices have analysts speculating that Sun could be a target for either acquisition or a restructuring…”
stupid analysts maybe. aquisition no, restructuring, possibly. If you look at Sun’s recent moves like buying up MySQL and VirtualBox and what they are doing with open sourcing a lot of their stuff that are just shifting in a newer direction. their old business modle wasn’t working, same with IBM and others who were big server companies.
So will Sun be bought by someone else, no, to think so would be rediculous. But it has been clear now for over a year that they are changing direction a bit from their older business model and that takes time to get settled and pull in a true profit.
The economy is tough for everyone right now, when it turns around Sun will bounce back, these slupms just happen. economics 101.
Edited 2008-08-27 17:32 UTC