How many S's does it take to characterize Sun?
By John Clingan on Feb 06, 2007
I had to do a double-take when I read this intro to a CNet article by Stephen Shankland. Here's the intro to his piece:
Storage and software company declares turnaround and sets new goals after years of financial troubles.
Wow, server is nowhere to be found. And two S's (storage and software) I wonder if he modified his article (or flubbed the reading) because it now says:
The server and software company ...
Now we are up to 3 S's, albeit in disparate locations. Software, Storage and Servers. There is one more S, as mentioned in today's Sun Analyst Conference. Jonathan's slide deck has a slide or two that help characterize Sun (Slides 28 and 29). Which S is Stephen missing? Services.
Services generate a significant portion of our revenue - over $2B gross margin according to our annual report. Not exactly chump change but nary a mention in most articles I read. I bet Steve agrees with me, as his job in life is to provide customers with support offerings such as the Sun Connection.
Now, you can say that Sun is a services company due to our servers, storage and software. True. We generally do not provide "general" consulting services as that is the role of our partners. However, we wouldn't be a server, storage and software company without services either. It's a ying-yang thing
Sssoooo, now we are up to servers, storage, software and services. That's 4. However, that's dividing and conquering Sun's value proposition. I know it makes chart creation simpler, but.that's simply not who we are. Time for a McNealy-ism. I have yet to find automotive industry analysts who says Ford / GM / etc are a dashboard and bucket-seat company. I also don't see Car & Driver test-driving just the steering wheel, and creating magic quadrants of each individual piece that makes up the car.
Now to look at the other side of the coin because that's not entirely fair. Our industry isn't entirely analogous to the automotive industry. Sun does sell the car, although we primarily sell the steering wheels, bucket seats and dashboards. It's not necessarily the way we want to sell them, but it's been the nature of the industry for decades. Most companies like to buy this way. However, we think the customers outpacing Moore's Law want to drive cost out of - or avoid entirely - a specialized (read: expensive) infrastructure into more general purpose "cars" such as BlackBox and the Sun Grid. Check out Greg Papadopoulos's slides at the analyst conference for this to "hit home".
Can a server company alone build a BlackBox or Sun Grid? How about a standalone software company? Storage company? Services? Well, a services company probably could, but not nearly as cost-effectively as a systems company can. Whoa! That's it, instead of calling Sun a storage, systems, software and/or services company, why not a systems company? Well, besides the fact that showing only two companies in a magic quadrant chart does not show much value add Sun can be best characterized as a systems company. Actually, we have been calling ourselves a systems company for as long as I can remember. We've also been advertising ourselves as such, but it doesn't seem to stick in the world of divide and conquer IT. Trade rags exacerbate the problem because that's the way traditional IT wants to read it. The good news is that a new IT class is emerging, and Jonathan views those in that class as the "IT as a competitive weapon" companies. I'll refer to them as car buyers. Once we have car buyers, we can look forward to the Car & Driver of IT publications. Then we'll know we are making progress.
Whups, almost forgot. To finish this post off, it takes one S to characterize Sun: systems.