Is EMC in the mood for Sun?

EMC could make a lot from a Sun acquisition, including from Sun's open-source strategy.

InternetNews.com's Andy Patrizio pens an excellent analysis of why EMC, the storage giant, just might gobble up Sun, the former Unix king. While there are potential conflicts to such a match, the synergies might well outweigh them.

Patrizio walks through a range of benefits EMC could derive from Sun's hardware prowess (tape storage to complement EMC's expertise in NAS and SAN, enhanced server throughput performance. ZFS, etc.), as well as its software line-up (Java, RSA security, database replication, etc.). The list is long and the potential benefits would be huge.

But it's actually in the very thing that Patrizio describes as a potential deal-killer - open source - that EMC could derive the biggest benefit. Patrizio warns:

There is one big snag to this EMC/Sun theory. EMC has displayed no interest in the open source movement, while Sun has embraced it in a big way. This could prove a no-win situation if EMC picks up Sun and open source advocates demand that it open source other products -- especially if GPL-licensed (define) products start mixing with EMC software. If EMC balks, it could wreck the goodwill Sun has built over the last few years. Then again, goodwill doesn't pay the bills.

True enough, but Sun's struggles derive from fighting open source (e.g., Linux kicking Unix out of data centers), not its embrace of open source. In areas like its Open Storage strategy, Sun has been doing very well.

What does EMC need that every vendor on the planet needs? Customers. But customers in the current environment and, indeed, well before it, are exceedingly expensive to acquire. A friend at Oracle tells me that his company routinely spends $1 million to win a $1 million license deal in order to capture the ongoing maintenance revenue stream.

One of the primary benefits of open source, contrarily, is that it drops the cost of customer acquisition to nearly $0.00. Sun's explicit strategy with open source is to use high-volume downloads of Java, MySQL, and other open-source projects to drive sales of its hardware and services. Sun's software, in other words, does the heavy lifting of lead acquisition while its hardware and solutions businesses do the heavy lifting on lead conversion.

Wouldn't EMC need the same thing? And, arguably, EMC would be in a better position to convert open-source leads into paid customers because it has more closed complements to sell to such leads.

Open source, in other words, may be one of the primary reasons for EMC to acquire Sun, not avoid it.

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