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"Sun will be immediately hurt more than any other company because Sun =
gets
more of its revenue -- close to 90 percent -- from the server market =
IBM is
about to target. Sun is in an extremely difficult position. Its =
strengths
have traditionally been in enterprise software and high-end hardware, =
both
of which mean that it can't flirt too much with Linux and AMD or risk =
its
traditional customer base. At the same time, IBM is targeting the same
customers as Sun, will be offering more powerful, cheaper hardware and =
a
great depth of software options, including a Linux that doesn't in any =
way
threaten other parts of IBM. Sun can't compete on chips, can't compete =
on
price, can't compete on depth. What are they to do? Their current =
strategy
of selling processing power by the cycle is like a new car dealer =
renting
back seats of cars on the lot to teenagers looking for a place to make =
out.

What Sun needs to do is to establish itself as the de facto UNIX (not =
Linux)
software vendor. Drop the hardware, make Solaris run beautifully on =
every
high-end system from every manufacturer and compete with Linux by =
offering
world-class consulting, service and support. Fortune 500 companies =
would
sigh with relief, but Sun would also have to accept that the company =
will
shrink in sales and headcount, though not in profit. This is the only =
viable
strategy left for Sun, which is going to shrink dramatically anyway,
possibly to nothing."