Sun Microsystems' latest management reorganization positions the company for new competitiveness in the critical software market. Nonetheless, real challenges remain for this hardware-focused vendor.
The recent Sun Open Network Environment branding
See news story:
Sun names new software chief
The new Sun Software organization--essentially a return to the old SunSoft, though with broader objectives--will enable the company to focus and integrate its enterprise software development and product-positioning efforts. The new Marketing and Business Development organization will enable Sun to consolidate its marketing message and help reconcile the conflicting objectives of the company's hardware and software operations. Sun Software and Sun Marketing and Business Development will be run by seasoned Sun executives with proven software track records--Jonathan Schwartz and Mark Tolliver, respectively.
These moves are clearly designed to move Sun closer to a truly competitive position as a software vendor. The company has long recognized that the software market--which offers higher profit margins and greater long-term growth potential than the glutted hardware market--is critical to its success. Despite its achievements with the Java programming language, however, the company has struggled to find ways to articulate its technology and business strategies for achieving leadership in the coveted enterprise software market.
The management reorganization will likely have a positive impact on Sun's long-term market position--and particularly on its ability to compete and partner in the all-important enterprise software infrastructure business. Nonetheless, the key challenges that Sun has long faced in the software market, and the technology market as a whole, remain in place.
In Gartner's opinion, Sun still lacks a truly effective software marketing message and continues to trail its primary competitors, including BEA Systems and IBM. Sun's enterprise software position had recently been threatened by Oracle, which could push Sun back to the No. 4 position among software infrastructure vendors. The company also remains somewhat isolated in the Web services community.
Gartner believes that perhaps the most damaging aspect is that Sun's momentum as an industry innovator continues to erode. These issues will likely be the first strategic targets for Sun's new software and marketing organizations.
(For related commentary on Sun's software strategy, see Gartner.com.)
Entire contents, Copyright © 2002 Gartner, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.