David Yen, executive vice president of Sun Microelectronics (Sun's chip group), is leaving the company after 20 years to go to Juniper Networks.
Mike Splain, who has been at Sun for two decades as well, has been appointed as acting head of the organization.
Yen has been one of Sun's most visible executives for several years and was seen as a rising star in the new era under CEO Jonathan Schwartz. The departure, despite what some analysts might say, is somewhat of a surprise.
The departure will also likely once again raise the question, "Why does Sun stay in chips, anyway?" Sun has produced a number of high-performance chips. The company, for instance, saw a dramatic increase in sales of servers based around its Niagara processor last year. Coming up with its own processors and input-output chips gives Sun a technological advantage, executives have said.
Designing a chip, however, can cost tens of millions of dollars, and that's before manufacturing commences. Recovering that investment through volume sales isn't easy. To make it even more challenging, a growing percentage of Sun's overall server sales in the past few years comes from Intel- and AMD-based servers.
In the early '90s, Sun Microelectronics functioned--or tried to function--somewhat independently, selling chips to both Sun and outside customers. But by the late '90s, Sun Microelectronics was absorbed back into the company.
Then in 2007, it was made an independent business group again, charged with selling chips and licensing technology to third parties. It landed some customers, such as Marvell Technology Group, and has attracted adherents by opening up some of its chip technology to royalty-free use. Still, Sun Microelectronics is not nearly as large as IBM's chip division.