Chapter 72 Section 1 Sun Microsystems
Sun Microsystems is the first high-tech company hatched from Stanford University. It is also the first computer company to enter the Chinese market and directly cooperate with the Chinese government in technology.At its peak in 2001, Sun had 50,000 employees worldwide and a market capitalization of more than 200 billion U.S. dollars, not only more than 30 times its market capitalization today, but also far more than the 17 billion of Google, which ranks second in market capitalization today. billion, and third-ranked IBM's $160 billion.Its office area exceeds 50 football fields (450,000 square meters), and there are more than a dozen football field-sized office buildings under construction.The Sun Company not only defeated all workstation (Work Station) and minicomputer (Mini Computer) companies including IBM, but also relied on its Solaris (a kind of Unix) and the world-popular Java programming language to become the most powerful operating system. A company that could challenge Microsoft.Sun has many talented people. It not only trained Google CEO Eric Schmidt and the first engineering vice president Wayne Rosen (Wayne Rosen), but also laid the foundation for today's Google engineering department to a certain extent. .
However, today’s Sun Company, not only the number of people, market share value, and office area are far from what they were back then (capable people have left, the office building has been sold, and the stock has plummeted), but it has completely withdrawn from the battle for supremacy in the IT field.It took nearly 20 years for Sun Company to reach its peak in 2000 from its establishment in 1982, but it only took one year for it to go downhill, which is enough to warn the operators.
Many people don't know the origin of the name Sun, but it is actually the acronym for Stanford University Network.When Andy Bechtolsheim (we will mention him later when we introduce Google) was a graduate student at Stanford University, he designed a "three million" small graphics computer called a Graphics Workstation (Graphic Workstation). Station).The "three million" refers to the calculation speed of one million times per second (one ten thousandth of today's microcomputer), one million bytes of memory (one thousandth of today's PC) and one million pixels. graphics display (lower than today's microcomputer monitors, higher than mobile phones).However, this was already very advanced at the time.Beck Thorsen used the Motorola 68000 processor and used a very advanced memory manager chip at that time to support virtual memory.Unlike ordinary microcomputers, network functions are a must.After Baker Torsen developed the prototype Sun-1, it was convenient for Stanford graduates such as Scott McNealy to come out of school in 1982 and found Sun.Marconelli served as the company's CEO until his retirement two years ago.Six months later, the company was profitable.This is the fastest profitable tech company I know of.Four years later, in 1986, Sun was listed on NASDAQ. The stock code at that time was SUNW, which is the abbreviation of Sun Workstation, not JAVA today.
Sun Workstation adopted Motorola's central processing unit in the early stage. In 1985, Sun Corporation developed its own SPARC RISC processor, which greatly improved the performance of workstations and ensured that workstations won the competition against DEC and HP minicomputers.For a long time before the 1990s, Sun's competitors were minicomputer companies and graphics workstation companies such as SGI. It is said that there is no disadvantage.Sun's victory is actually a victory of Unix-based servers and workstations over traditional centralized small and medium-sized computers (represented by DEC and HP) and terminal systems.The elimination of the former and the latter is an inevitable trend in the development of computer and network technology.
However, Sun is far from having the good luck of AT&T and IBM, whose mainstream products can be sold for more than ten years.The rise of Sun was in the era of the information revolution, and the cycle of all technological revolutions was greatly shortened.Since the 1990s, with the development of microcomputers, network systems based on microcomputers have occupied a large market for small and medium-sized enterprises.Although 3Com and Novell were promoting their microcomputer-based Ethernet systems as early as the 1980s, their business and Sun did not have much overlap, so they would not threaten the development of Sun.By the late nineties, the situation had changed radically.In terms of hardware, high-end microcomputers are not inferior to low-end workstations in computing speed, but the price is much cheaper.In terms of software, after Microsoft launched Windows NT, it has an enterprise-level (enterprise) network operating system solution.In this way, the time for high-end microcomputers to replace low-end workstations and minicomputers to enter the enterprise-level market is ripe, and the battle for enterprise-level supremacy begins between Microsoft and Sun.
Sun's position is very much like Apple's in the microcomputer war.It has its own set of hardware and operating system, but it lacks application software.Sun's Star Office is probably not used by other decent companies except itself.And Microsoft only makes software, and only a few but crucial software such as operating system (Windows NT), database SQL Server and office software (Office).These three kinds of software are essential for an enterprise.
This battle for hegemony is much easier for Microsoft than its competition with Apple. First of all, Microsoft in 1995 is no longer a small company in the early 1980s. It has become a rare high-growth and high-profit company in history.With money, an ambitious entrepreneur can find the man he wants.For example, Gates even set up R&D offices in their existing cities in order to take care of those database experts who are unwilling to move.This is what Microsoft could not do when it competed with Apple in the early days; secondly, Microsoft has formed a monopoly in the field of microcomputers, and it is very good at extending (Leverage) the advantages of monopoly to other fields—non-computer professional users accept Microsoft’s The Windows NT operating system is much easier than accepting the Sun's Solaris, because everyone uses Windows 3.1 and Windows 95, which are no different from NT, on their own microcomputers; Three parties, while Sun, like Apple, often had to develop their own. (Apple has faced the same problem.) We know that whether an operating system can be promoted depends on how many applications are available on it.There are far more applications on Microsoft Windows NT than on Solaris.Finally, and most critically, is the human factor.We have to admit that Microsoft's management team was the best in the IT field in the world at that time, and Bill Gates was also the best industry leader back then.
On the other hand, Solaris, its operating system, has obvious advantages over Windows NT in technology.We skip the technical details here because it would take too much space to make it clear.Facts have proved that various Unix operating systems including Solaris can make better use of computer resources than Windows NT, especially when the computer system is huge and the number of users is greatly increased. In 1997, after Microsoft bought Hotmail, it took a lot of effort to transplant the latter's email service system from its original two Unix (FreeBSD and Solaris) operating systems to Microsoft's own Windows NT. Succeeded because Windows NT was inconvenient to manage so many servers and users.However, Microsoft must do this again, otherwise it will not be able to persuade enterprise customers to buy its own operating system.As a result, Microsoft spent more effort and finally ported Hotmail to Windows 2000, the later version of NT.But it is said that some of these functions are still performed by Unix.Sun's version of Unix, Solaris, is the most reliable and complete of all commercial versions.The battle between Sun and Microsoft is actually a battle for enterprise-level operating systems.For Sun, the key to success lies in whether it can convert its technological advantage in Unix into a market advantage.
The Sun company led by Marconelli did not even see the importance of the decisive battle for the operating system for a long time, so the Sun company lost the first round of the competition between the company and Microsoft before it even started.This is not because Marconi is incompetent, but because the "thinking" of Marconi and others is locked in selling hardware.Although Sun's workstations cost tens of thousands of dollars and servers cost one hundred thousand dollars, they were much cheaper than DEC's minicomputers and IBM's mainframes.Due to the rise of the Internet in the late 1990s, Sun's servers and workstations sold very well and made too much money.Although Sun's market share of small and medium-sized enterprises has been continuously eroded by the Microsoft/Intel alliance, it is also continuously occupying the original DEC and HP minicomputer market and has enough virgin land to develop.Therefore, its overall business is still expanding.This is very similar to the Kingdom of Spain in the sixteenth century. Although its Invincible Fleet has been defeated by the British and lost its status as a sea supremacy, there are still many virgin lands that can be colonized in the world, supporting this second child at sea to prosper for two years. For centuries, until the nineteenth century, when there were no more colonies in the world to develop, the crisis buried in Spain in the early days was not manifested.Of course, decline came faster than prosperity, and within a short period of time Spain went from rich to poor in Europe.The same goes for Sun.From 1986 to 2001, Sun's turnover rose from 210 million US dollars to 18.3 billion US dollars, with an average growth rate of 36% per year. It has been able to maintain such a high-speed development for 15 consecutive years. Only Microsoft, Intel and Cisco have ever achieved it. Pass.Under such circumstances, few people can calmly see the crisis behind the rapid development.At that time, Sun was content to pinch soft persimmons such as SGI, DEC and HP, and indulged in the victory in the hardware market, ignoring the threat from Microsoft.But when the dot-com bubble burst in 2000, its hardware business, dominated by servers and workstations, took a nosedive. In the 2002 fiscal year (to June 2002), its turnover dropped by 30% compared with the previous year, and it fell from a profit of 900 million US dollars in the previous year to a loss of 500 million US dollars.Sun Company could not find a stable source of profit or a new growth point. Since then, Sun Company has been in decline, from the most valuable company in Silicon Valley to the company with the lowest per capita market value.
At Sun, at least two people learned from it: Schmidt, who later became CEO of Google, and Jonathon Schwartz, Sun's current CEO.Schmidt was Sun's vice president in charge of software at the time, and he summed up the anti-Moore theorem from the lessons of Sun's failure, which we have already introduced.Schmidt recognized that profits in hardware depended on a constant decline, whereas profits in IT services were constant (and increased slightly with inflation).If Schmidt is the theorist, Schwartz is the practitioner, who embarked on Sun's transformation from a hardware manufacturer to an IT service.It is a pity that the Sun Company led by Marconelli at that time did not see this, and it was difficult to see this.
Facts have proved that although Microsoft is the most terrifying opponent in the history of IT, it is not invulnerable.Historically Oracle (Oracle), Intuit (TurboTax), Adobe and Yahoo, and today Google have all beaten Microsoft in their own domain.Although Microsoft has the best computer scientists and software engineers in the world, its products are rarely ahead of competitors in technology, and it wins more by commercial advantages.The above-mentioned companies saw the key to their competition with Microsoft, used technological advantages to stick to their own fields, did not give Microsoft an opportunity, and finally won.In the 1990s, Unix had an advantage over Windows NT in the business of small and medium-sized enterprises.Various versions of Unix, including open source Linux, have their own stable clients.
The first thing Sun should do is to take advantage of its dominant position in Unix, or unite or merge with other Unix server vendors to deal with Microsoft and hold on to the medium and large enterprise market.It can at least compete with Microsoft on the operating system.So far, Windows servers have not been able to replace Unix in many businesses.However, Sun Company took the lead in fighting in the Unix camp back then, and did not turn its energy to compete with Microsoft at all.
The second thing Sun should do is to change its business model to open source Solaris, from selling the operating system to providing services.You know, a Solaris operating system is only two or three hundred dollars, but one hour of service in the IT field can charge that much.However, Sun's business model of being primarily a hardware business (rather than a services business) made it impossible to open source Solaris, since its main money comes from hardware. (For this reason, it is impossible for Apple to open source its iPhone operating system.) I often mentioned the theory of genetic determination in the previous chapters, and some readers thought I was fatalistic.But it turns out that most companies, including many great companies, are hard to escape this fate. (There are also some exceptions, and we will introduce these exceptional companies in the future, such as General Electric GE and 3M.) On the contrary, IBM, which focuses on services, joined the ranks of open source Linux relatively early. After 2000, because high-end microcomputers have reached the computing speed of workstations, and the price is much cheaper, IBM has changed from a price disadvantage to Sun to a price advantage by relying on open source Linux servers.By 2004, Sun Corporation understood this truth and opened up Solaris. IBM had seized the opportunity and became the largest service provider in the Unix market.
Marconili attaches great importance to research and development. Sun has successively developed the Sparc series of processors and workstations, and the Solaris operating system. These products have brought considerable profits to Sun.But the most significant invention of Sun Corporation is the Java programming language, which has not brought any economic benefits to Sun Corporation so far.Sun's third regret is that it has not been able to indirectly convert Java into profits.
Let's briefly review the background of Java's birth.Before the 1990s, computers in the world were either not connected to the Internet, or they were connected to the Internet within the enterprise.The content and resources that can be shared by the public are limited.As long as the computer systems in each unit are unified by themselves, it will be fine.When the Internet is booming, the need to share information and resources between different computers arises.At this time, a new type of platform (Platform) across different hardware and different operating systems is needed to realize human-computer communication on this platform.In May 1995, Sun Corporation released the Java high-level programming language. Since it does not require hardware-related compilers, it is just right for this requirement. (Note: Most high-level language programs need to be compiled according to different computers before running. Java programs do not need to be compiled, but run while interpreting at runtime. In this way, Java programs are not affected by the computing platform. Constraints, after the rise of the Internet, are especially well-suited to programming on the Internet.) It can be said that the timing of Java's birth is very good, and it provides Sun with a possibility to replace the operating system companies (mainly Microsoft) to dominate the computer field.The following figure shows how operating system companies used operating systems to unify different hardware and control users before the Internet era.At this time, the crown of the computer industry belonged to the operating system company.
And this picture is a new concept of controlling users through cross-operating system platforms in the Internet age.At this time, the company that controls the cross-OS platform may become the new king.
Marconi saw this.After Java came out, Sun Company lost money and vigorously promoted it. Only three months later, Netscape decided to adopt Java.Since Java is a new generation of object-oriented (Object Oriented) programming language, it has the advantages of not being restricted by the operating system, having strong support for network functions, and being able to run remote programs on the local computer, plus it is very convenient for end users. It's free, and Java is promoted immediately.Soon Oracle, Borland, SGI, Adobe, IBM, AT&T, and Intel joined the Java allies.
However, Sun's dream of realizing a cross-operating system platform through Java has not been realized so far.In the words of Wall Street, Java is losing money and making money.Sun Company still doesn't know how to make money after earning money.I have contacted many people in Sun Corporation, and most of them complain that Java, a free thing, cannot make money.I think it mainly depends on the person. Imagine that if Java was in the hands of Gates, he would be able to play countless tricks.
In fact, Microsoft was so greedy for the baby Java that in 1996 it had to purchase a Java license (License) from Sun.Sun's original idea was to promote Java through Microsoft, and the contract was signed in this way.However, Microsoft has its own calculations, and instead of providing users with products developed in Java in accordance with the contract, it uses Sun's technology to develop its own similar products.What's more, according to the later judgment of the court, Microsoft misled Java developers and prevented them from developing products compatible with Sun's Java technology, so as to suppress Java.In order to meet the needs of building websites and developing application programs on the Internet, Sun developed a corresponding Java-based JSP development environment, while Microsoft competed and developed ASP technology based on its own Visual Basic.Given that Microsoft used its monopoly position in the operating system field to suppress Sun, the latter had to sue Microsoft in the U.S. District Court of California in October 1997, accusing the latter of violating the contract signed by the two companies on Java technology and demanding Microsoft stops violating the Java Compatibility Standard.The lawsuit later escalated and was tied to Microsoft's antitrust lawsuit. In 2001, Sun won the long-running lawsuit and won Microsoft's billion-dollar compensation.However, Microsoft has gained a larger market share.
Although the licensing fees of ASP and JSP itself are not important to the direct income of both parties, they have a great impact on the computer server market structure.In the late 1990s, the worldwide computer server market developed at an unprecedented rate.On the one hand, this is driven by the economic development of the United States and China (in the past two decades, these two countries have contributed half of the net added value of global GDP), and on the other hand, it is due to the rise of the Internet around the world.Almost every company must have its own website, and must purchase a server to run the website, or rent a server in a professional data center.Whether it is maintaining a website by itself or renting a data center, it will stimulate the rapid development of the server market.The external interfaces of websites all over the world are basically either ASP or JSP. The operating system used by the former is the operating system of Microsoft, and the servers used are servers of microcomputer manufacturers such as Dell and HP; the corresponding operating system of the latter is mainly Unix, and the servers used are It is the product of workstation and server manufacturers such as Sun, SGI and IBM. Before 2000, the entire server market not only developed rapidly, but also seemed to see no sign of saturation, and there was even an absurd incident where IBM purchased Sun's servers.Since both server markets can grow, Sun's performance has nothing to do with the ASP vs. JSP battle.But after 2000, the Internet bubble burst, most of the unprofitable .com companies closed down, and the surviving companies also stopped purchasing like a sudden brake.The server market suddenly slumped, and the server market became a zero-sum game. If more Windows servers are sold, the sales of Sun's hardware products will not be smooth.In this way, Sun Company fell from the peak to the bottom in just one year.The chart below shows the trend of Sun's stock around 2000.
The consequences of Sun's failure in the battle with Microsoft's operating system and Internet platform have only now been seen.What's even more frightening is that even in the Unix server market, the cheap servers based on open source Linux led by IBM have surpassed Sun's Solaris servers.Sun Company rejected wolves at the front door and drove tigers away at the back door. It was miserable.In 2003, the market share of Windows servers was basically equal to that of Unix servers (of course, the sales were larger than the latter).This year, Sun lost as much as 3.4 billion U.S. dollars, and people even doubted whether it could survive as an independent company.Sun finally realized the importance of increasing Solaris server market share through open source, but it was too late. In 2006, Marconi, who had worked in Sun for more than 20 years, resigned as CEO, and Schwartz, who had a software background, took over.Schwartz carried out large-scale layoffs, and sold a lot of real estate, and finally turned Sun into a profit.At the same time, he transformed Sun from a hardware manufacturer into a software developer and service provider.Sun's services revenue rose from 16 percent in 2001 to 37 percent in 2007.Schwartz is the founder of open source in Sun Corporation, and he opened Solaris when he was the second-in-command COO.These measures have made Sun's market share rebound, and IT services have brought Sun a strong cash flow.Now, Sun has no problem surviving, but it has been reduced to a second-tier company, forever losing its chance to compete with Microsoft and IBM.
The battle between Sun and Microsoft has become history.The lessons learned are worth summarizing for technology companies.Sun Company first lost in people (or talent system).Marconi intends to build a cross-platform system to control the enterprise-level network, but Sun's top-to-bottom execution is not enough to complete this historical mission.Marconi was by no means mediocre, but he was not a genius either.Sun under Marconi was notorious among Silicon Valley companies for its inefficiency.Sun has no shortage of talents, but its mediocre and big-pot management is actually carrying out survival of the fittest.After leaving Sun, many people did a much better job than they did at Sun, including Google CEO Schmidt and Juniper co-founder Bjorn Liencres, as well as many senior engineers in Google's early days.Rosen Wayne, the former vice president of Google who served as the vice president of Sun Company, said that the most powerful trick in the talent competition is to poach good people from competitors, while at the same time it must let those who are below average All the level people stay.Unfortunately Sun has done this for its rivals themselves.Many people in Sun Company are actually proud to join Microsoft, which is enough to explain the management problems of Sun Company.When a large number of outstanding talents left and the company's performance declined sharply, Marconelli did not decisively lay off a large number of employees.He always gave himself an excuse, we managed to recruit so many people (in the era of the dot-com bubble, it was very difficult to find engineers), if we lay off redundant staff now, in case the market improves, where will I recruit people.In fact, the "what if" that Marconi was worried about never happened.Although later with the recovery of the US economy, Sun's business improved, but it has not returned to the level of its 2001 fiscal year (July 2000 to June 2001) (a turnover of 18.3 billion US dollars).Moreover, the world's demand for the information technology industry has changed, and the knowledge structure of those talents (many of which are hardware and system talents) reserved by Marconi has become outdated.
The second fatal mistake made by Sun is that it did not put the battle between Sun and Microsoft's operating system and Internet development tools above its competition with server companies such as HP and DEC.This leads to the serious consequences we mentioned earlier.In Sun’s 2001 financial report submitted to the U.S. Securities and Exchange Commission, Sun listed IBM, HP, and Compaq as top competitors in the chapter on investment risk factors (Risk Factors) in the first paragraph, and placed Microsoft in the first paragraph. Secondary status is written in the second paragraph.And it just treats its competition with Microsoft as a simple competition between workstations and PCs.The original text is as follows:
Our competitors are some of the largest, most successful companies in the world. They include International Business Machines Corporation (IBM), Hewlett-Packard Company (HP), Compaq Computer Corporation (Compaq), and EMC Corporation (EMC).
We also compete with systems manufacturers and resellers of systems based on microprocessors from Intel Corporation (Intel) and the Windows family of operating systems software from Microsoft Corporation (Microsoft). These competitors include Dell Computer Corporation (Dell), HP, and Compaq, in addition...
In 2005, Sun had a new understanding of Microsoft and put it in the same paragraph as IBM and other server companies, but still wrote system manufacturers IBM and HP in the first sentence, and Microsoft in the second sentence .This year, that is, the second year of Schwartz's tenure, Sun finally realized the threat of Microsoft and wrote Microsoft into the same sentence as IBM.And next, it mentions Microsoft's operating system and Linux operating system first.Then mention the computer service provider.It referred to IBM and Hewlett-Packard not as rival computer makers but as service providers.The original text is as follows:
Our competitors are some of the largest, most successful companies in the world. They include IBM, Dell, HP, EMC, Fujitsu, HDS, the Fujitsu-Siemens joint venture, Microsoft and Intel. We compete with (i) systems manufacturers and resellers of systems based on microprocessors from Intel, the Windows family of operating systems software from Microsoft and the Linux family of operating systems software from Red Hat and others, as well as (ii) companies that focus on providing support and maintenance services for computer systems and storage products.
However, that was the year the Windows-based server market finally surpassed Unix sales ($17.7 billion versus $17.5 billion), and the trend has not reversed to this day.
If Sun had realized the importance of operating systems, Internet development tools, and IT services ten years ago, today's computer industry might be a situation where Microsoft, IBM, and Sun are at the top of each other.Ten years ago, the Unix operating system had such a huge advantage among enterprise users that even Microsoft had to develop its own Unix (Lenix on sixteen-bit microcomputers).When Unix workstation companies and related software and hardware companies sprung up all over the world, they needed a leader to compete with Microsoft, and Sun was the best choice.Sun's correct approach is to unite, merge, and support large and small Unix software and hardware companies, while open-sourcing Solaris instead of suppressing other Unix companies.Perhaps Google has learned a lesson from the failure of the sun. Unlike most websites in the past, which hope that other websites will close their doors, Google has been helping other websites to develop together and share profits. Its allies include AOL, AskJeeves and other online Millions of websites and online sellers, so it is still invincible in the competition with Microsoft, because the latter is not simply competing with Google but with half of the Internet industry.If Sun can be the leader of Unix software and hardware companies, then today's enterprise computer market is likely to be dominated by Sun.
It would be Sun's misfortune to have to compete with Microsoft, but the latter is not without its chances.Unfortunately, the sun did not seize the fleeting opportunity and finally failed.
This is exactly what Zweig said, "In the great moment of fate, all the virtues of the burghers-care, obedience, industry, prudence, are of no avail, it always requires only the genius and makes him an immortal image. Fate despises those who are timid. Fate—another god in this world, is only willing to lift up the brave with warm arms and send them to the heaven of heroes.”
And this picture is a new concept of controlling users through cross-operating system platforms in the Internet age.At this time, the company that controls the cross-OS platform may become the new king.
Marconi saw this.After Java came out, Sun Company lost money and vigorously promoted it. Only three months later, Netscape decided to adopt Java.Since Java is a new generation of object-oriented (Object Oriented) programming language, it has the advantages of not being restricted by the operating system, having strong support for network functions, and being able to run remote programs on the local computer, plus it is very convenient for end users. It's free, and Java is promoted immediately.Soon Oracle, Borland, SGI, Adobe, IBM, AT&T, and Intel joined the Java allies.
However, Sun's dream of realizing a cross-operating system platform through Java has not been realized so far.In the words of Wall Street, Java is losing money and making money.Sun Company still doesn't know how to make money after earning money.I have contacted many people in Sun Corporation, and most of them complain that Java, a free thing, cannot make money.I think it mainly depends on the person. Imagine that if Java was in the hands of Gates, he would be able to play countless tricks.
In fact, Microsoft was so greedy for the baby Java that in 1996 it had to purchase a Java license (License) from Sun.Sun's original idea was to promote Java through Microsoft, and the contract was signed in this way.However, Microsoft has its own calculations, and instead of providing users with products developed in Java in accordance with the contract, it uses Sun's technology to develop its own similar products.What's more, according to the later judgment of the court, Microsoft misled Java developers and prevented them from developing products compatible with Sun's Java technology, so as to suppress Java.In order to meet the needs of building websites and developing application programs on the Internet, Sun developed a corresponding Java-based JSP development environment, while Microsoft competed and developed ASP technology based on its own Visual Basic.Given that Microsoft used its monopoly position in the operating system field to suppress Sun, the latter had to sue Microsoft in the U.S. District Court of California in October 1997, accusing the latter of violating the contract signed by the two companies on Java technology and demanding Microsoft stops violating the Java Compatibility Standard.The lawsuit later escalated and was tied to Microsoft's antitrust lawsuit. In 2001, Sun won the long-running lawsuit and won Microsoft's billion-dollar compensation.However, Microsoft has gained a larger market share.
Although the licensing fees of ASP and JSP itself are not important to the direct income of both parties, they have a great impact on the computer server market structure.In the late 1990s, the worldwide computer server market developed at an unprecedented rate.On the one hand, this is driven by the economic development of the United States and China (in the past two decades, these two countries have contributed half of the net added value of global GDP), and on the other hand, it is due to the rise of the Internet around the world.Almost every company must have its own website, and must purchase a server to run the website, or rent a server in a professional data center.Whether it is maintaining a website by itself or renting a data center, it will stimulate the rapid development of the server market.The external interfaces of websites all over the world are basically either ASP or JSP. The operating system used by the former is the operating system of Microsoft, and the servers used are servers of microcomputer manufacturers such as Dell and HP; the corresponding operating system of the latter is mainly Unix, and the servers used are It is the product of workstation and server manufacturers such as Sun, SGI and IBM. Before 2000, the entire server market not only developed rapidly, but also seemed to see no sign of saturation, and there was even an absurd incident where IBM purchased Sun's servers.Since both server markets can grow, Sun's performance has nothing to do with the ASP vs. JSP battle.But after 2000, the Internet bubble burst, most of the unprofitable .com companies closed down, and the surviving companies also stopped purchasing like a sudden brake.The server market suddenly slumped, and the server market became a zero-sum game. If more Windows servers are sold, the sales of Sun's hardware products will not be smooth.In this way, Sun Company fell from the peak to the bottom in just one year.The chart below shows the trend of Sun's stock around 2000.
The consequences of Sun's failure in the battle with Microsoft's operating system and Internet platform have only now been seen.What's even more frightening is that even in the Unix server market, the cheap servers based on open source Linux led by IBM have surpassed Sun's Solaris servers.Sun Company rejected wolves at the front door and drove tigers away at the back door. It was miserable.In 2003, the market share of Windows servers was basically equal to that of Unix servers (of course, the sales were larger than the latter).This year, Sun lost as much as 3.4 billion U.S. dollars, and people even doubted whether it could survive as an independent company.Sun finally realized the importance of increasing Solaris server market share through open source, but it was too late. In 2006, Marconi, who had worked in Sun for more than 20 years, resigned as CEO, and Schwartz, who had a software background, took over.Schwartz carried out large-scale layoffs, and sold a lot of real estate, and finally turned Sun into a profit.At the same time, he transformed Sun from a hardware manufacturer into a software developer and service provider.Sun's services revenue rose from 16 percent in 2001 to 37 percent in 2007.Schwartz is the founder of open source in Sun Corporation, and he opened Solaris when he was the second-in-command COO.These measures have made Sun's market share rebound, and IT services have brought Sun a strong cash flow.Now, Sun has no problem surviving, but it has been reduced to a second-tier company, forever losing its chance to compete with Microsoft and IBM.
The battle between Sun and Microsoft has become history.The lessons learned are worth summarizing for technology companies.Sun Company first lost in people (or talent system).Marconi intends to build a cross-platform system to control the enterprise-level network, but Sun's top-to-bottom execution is not enough to complete this historical mission.Marconi was by no means mediocre, but he was not a genius either.Sun under Marconi was notorious among Silicon Valley companies for its inefficiency.Sun has no shortage of talents, but its mediocre and big-pot management is actually carrying out survival of the fittest.After leaving Sun, many people did a much better job than they did at Sun, including Google CEO Schmidt and Juniper co-founder Bjorn Liencres, as well as many senior engineers in Google's early days.Rosen Wayne, the former vice president of Google who served as the vice president of Sun Company, said that the most powerful trick in the talent competition is to poach good people from competitors, while at the same time it must let those who are below average All the level people stay.Unfortunately Sun has done this for its rivals themselves.Many people in Sun Company are actually proud to join Microsoft, which is enough to explain the management problems of Sun Company.When a large number of outstanding talents left and the company's performance declined sharply, Marconelli did not decisively lay off a large number of employees.He always gave himself an excuse, we managed to recruit so many people (in the era of the dot-com bubble, it was very difficult to find engineers), if we lay off redundant staff now, in case the market improves, where will I recruit people.In fact, the "what if" that Marconi was worried about never happened.Although later with the recovery of the US economy, Sun's business improved, but it has not returned to the level of its 2001 fiscal year (July 2000 to June 2001) (a turnover of 18.3 billion US dollars).Moreover, the world's demand for the information technology industry has changed, and the knowledge structure of those talents (many of which are hardware and system talents) reserved by Marconi has become outdated.
The second fatal mistake made by Sun is that it did not put the battle between Sun and Microsoft's operating system and Internet development tools above its competition with server companies such as HP and DEC.This leads to the serious consequences we mentioned earlier.In Sun’s 2001 financial report submitted to the U.S. Securities and Exchange Commission, Sun listed IBM, HP, and Compaq as top competitors in the chapter on investment risk factors (Risk Factors) in the first paragraph, and placed Microsoft in the first paragraph. Secondary status is written in the second paragraph.And it just treats its competition with Microsoft as a simple competition between workstations and PCs.The original text is as follows:
Our competitors are some of the largest, most successful companies in the world. They include International Business Machines Corporation (IBM), Hewlett-Packard Company (HP), Compaq Computer Corporation (Compaq), and EMC Corporation (EMC).
We also compete with systems manufacturers and resellers of systems based on microprocessors from Intel Corporation (Intel) and the Windows family of operating systems software from Microsoft Corporation (Microsoft). These competitors include Dell Computer Corporation (Dell), HP, and Compaq, in addition...
In 2005, Sun had a new understanding of Microsoft and put it in the same paragraph as IBM and other server companies, but still wrote system manufacturers IBM and HP in the first sentence, and Microsoft in the second sentence .This year, that is, the second year of Schwartz's tenure, Sun finally realized the threat of Microsoft and wrote Microsoft into the same sentence as IBM.And next, it mentions Microsoft's operating system and Linux operating system first.Then mention the computer service provider.It referred to IBM and Hewlett-Packard not as rival computer makers but as service providers.The original text is as follows:
Our competitors are some of the largest, most successful companies in the world. They include IBM, Dell, HP, EMC, Fujitsu, HDS, the Fujitsu-Siemens joint venture, Microsoft and Intel. We compete with (i) systems manufacturers and resellers of systems based on microprocessors from Intel, the Windows family of operating systems software from Microsoft and the Linux family of operating systems software from Red Hat and others, as well as (ii) companies that focus on providing support and maintenance services for computer systems and storage products.
However, that was the year the Windows-based server market finally surpassed Unix sales ($17.7 billion versus $17.5 billion), and the trend has not reversed to this day.
If Sun had realized the importance of operating systems, Internet development tools, and IT services ten years ago, today's computer industry might be a situation where Microsoft, IBM, and Sun are at the top of each other.Ten years ago, the Unix operating system had such a huge advantage among enterprise users that even Microsoft had to develop its own Unix (Lenix on sixteen-bit microcomputers).When Unix workstation companies and related software and hardware companies sprung up all over the world, they needed a leader to compete with Microsoft, and Sun was the best choice.Sun's correct approach is to unite, merge, and support large and small Unix software and hardware companies, while open-sourcing Solaris instead of suppressing other Unix companies.Perhaps Google has learned a lesson from the failure of the sun. Unlike most websites in the past, which hope that other websites will close their doors, Google has been helping other websites to develop together and share profits. Its allies include AOL, AskJeeves and other online Millions of websites and online sellers, so it is still invincible in the competition with Microsoft, because the latter is not simply competing with Google but with half of the Internet industry.If Sun can be the leader of Unix software and hardware companies, then today's enterprise computer market is likely to be dominated by Sun.
It would be Sun's misfortune to have to compete with Microsoft, but the latter is not without its chances.Unfortunately, the sun did not seize the fleeting opportunity and finally failed.
This is exactly what Zweig said, "In the great moment of fate, all the virtues of the burghers-care, obedience, industry, prudence, are of no avail, it always requires only the genius and makes him an immortal image. Fate despises those who are timid. Fate—another god in this world, is only willing to lift up the brave with warm arms and send them to the heaven of heroes.”