RE: Kevin Hutchinson
Because of simple economics - Sun needs money to invest in product development and just to pay the running bills, including ongoing legal fees. Sun currently has four sources for such cash - product and services sales (declining overall, so more money going out than coming in), loans from the banks (and the banks aren't lending), sales of shares (nobody wants them, even at the low prices they are at), and by using the cash reserves. Sun has been burning through the latter just about continually since Y2K, and simply can't afford to continue doing so, not if it wants to pursue the patent troll route as it is doing with NetApp.
You want Sun to buy itself out? So, Sun uses it's cash to try and buy back shares, but what if Sun ends up unable to buy all the shares? It is still on the stock market, and now with no cash reserves. Which would make it even more of a basket-case, and the vultures move in for the asset-stripping in shorter time.
Or, Sun can wait it out, and hope the declining sales and cash reserves manage to last through the recession until some mythical boom time when customers aren't going to give a hoot about costs and just buy Sun kit for fun - unlikely, cue the vultures a bit later down the line.
Or Sun sells some assets to cut costs, maintains the current product lines but slims down on expenses, and hopes for that same mythical boom time. Only problem is they have very little assets of value left, even their patent portfolio would not raise a billion in cash, so they just end up opening the door to the vultures in stages.
Which brings us to what the market are really telling Sun to do - downsize and radically re-align.
And that means taking a long, honest look at the enterprise server business. Maybe keep the enterprise SPARC line for now whilst the majority of the development costs are footed by Fujitsu, but drop Rock and concentrate on x86 and possibly Niagara. If Niagara can't make the profits required to at least fund itself and future developments, be smart and drop it now. Talk to Fujitsu and find out what is really planned for SPARC64, and then make a grown-up decision about possibly porting to another architecture such as Power or Itanium (the former is now quite possible with IBM buying Transitive) if they want to stay in the enterprise high end.
If StorageTek can't make any money then take an axe to it and clear out the deadwood products. I have no idea why Chris thinks anyone would buy the tape bizz, especially HP (tape market leader)! Again, the patent portfolio is worth some but not much, but patents cost peanuts to maintain and can be easily sold later without including painful staff cuts, unlike hardware product lines. Tape is dying - apply investments accordingly, and treat as deadwood if required with calm hubris rather than the usual Sun posturing.
And Solaris - supposedly a crown jewel but one that can't seem to make Sun any money. Sun will just have to evaluate whether it can make money going head to head with Red Hat and Novell, and if not then be brave, drop Solaris and really partner with Linux and M$.
I can't see Sun selling the x86 business as Chris said, especially not to IBM who seem intent on selling their own xSeries to Lenovo. Besides, it's the Sun product line that would seem to actually make a profit whilst incurring the least risk/investment as the majority of the technology is not developed by Sun.
MySQL? Swallow the pride and sell it now, whilst it still has some goodwill value. Maybe Oracle would take it just to stop M$ buying up a competitor, or maybe SAP would like their own database. Either way, I can't see much of a buyer queue forming in a recession.
And a merger? Chris, with whom? HP or IBM are simply unlikely as neither really has the need, and if one proposed it the other would probably start legal/monoploy proceedings just to prolong the agony. Fujitsu seem off the buyers list - apart from the fact they're busy divorcing Siemens, there is the question of do they really want to buy anything from Sun. Remember, Solaris, and SPARC are "opensource", so if Fujitsu really wants to continue with either it doesn't have to buy the over-staffed and over-priced divisions from Sun. Fujitsu already have their own bigger x86 bizz and work with M$ and the Linux boyos, so they don't need anything there either, and a declining Sun customer base is probably not a big enough draw. Hence I am not surprised to see Chris leave Fujitsu - once seen as Sun's White Knight in waiting - right out of the picture.
And the EMC idea is so left field it should have come with a disclaimer. I cannot think of one reason why EMC would want any product from Sun's portfolio other than some of the patents, and with Sun opensourcing ZFS there is no need to buy Sun even if they thought ZFS was worth it. Would EMC pay good money now for the Sun tape bizz when they can simply wait and pick it up as a bargain later?
In summary, Sun needs to concentrate on the x86 business and make it such a core product range that skilled x86 people will want to work there just like UNIX and RISC people used to. But that means jettisoning the majority of the old SPARC/Solaris, MySQL and most of the storage business, otherwise it will simply drag the x86 part down with it. If Sun can survive as a "me-too" x86 business and follow just behind the bleeding edge of the market, then maybe it can survive long enough to look forward to a future where it can again move into being a tech innovator.