Sun's CEO rips PC industry on its home turf

Scott McNealy goes deep into enemy territory, telling thousands of Comdex attendees that the PC industry is outmoded and technologically inferior.

Stephen Shankland principal writer
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Stephen Shankland
4 min read
LAS VEGAS--Scott McNealy, chief executive of Sun Microsystems, went deep into enemy territory today, telling thousands of Comdex attendees that the PC industry is outmoded and technologically inferior.

"Comdex should not exist," McNealy said during a keynote here. "Workstations are so 'last year' for mere mortals. I hope I'm not raining on the PC show, but that's just how we see it."

Reiterating a traditional Sun theme, McNealy suggested bypassing bulky and crash-prone PCs and instead using information appliances, cell phones and other gadgets connected to the Internet, with Sun servers doing the computational heavy lifting on the other end.

"Everything with a digital or electric heartbeat is going to be connected to the Internet," he said. "The big opportunity is getting everything connected to the Internet."

It's a common theme at the largest annual U.S. computer trade show. Hardware and software makers have been spending a good portion of the week talking up connected devices such as the MSN Web Companion or Sony PlayStation 2.

McNealy gave several examples of the Net connected future: Light bulbs will be able to warn when they're about to expire, letting the factory automatically deliver a replacement. Vending machines will bill you automatically when you order a Coke with your cell phone. And the TV set-top box will be the nerve center of home networks that tie together dishwashers, thermostats, video cameras and everything else.

Sun has staked its future on selling powerful server computers, and indeed industry analysts say the company has been successful in associating its name with the Internet and the e-commerce activities that are just beginning to take off.

But many analysts believe PCs will coexist with other gadgets for years to come. In any case, by shunning PCs, Sun also missed out on billions of dollars in revenue that flowed into companies such as Dell Computer, Compaq Computer, Hewlett-Packard and IBM.

Sun wants its Java and Jini technology to provide the software underpinnings that enable this world of Internet-enabled gadgets. But Sun hasn't included royalty payments from Java and Jini use in such gadgets in its revenue forecasts, he said.

"If we make any money on the client environment, that's all gravy," McNealy said.

McNealy's vision hinges on the ubiquity of high-speed, broadband networks, though, an infrastructure that McNealy himself said he found lacking when he suffered through the downloading of large email messages this morning. Broadband refers to technologies such as cable or digital subscriber lines (DSL) that send data across a network at much greater speeds than common dial-up connections.

Faster networks will come, though, and soon a house without Internet access will be as inconceivable as a house today without plumbing and electricity, he said. There will come a time that your children will ask if you really had a house that didn't have a high-speed Internet connection in every room, he said. "They're just going to look at you and say, 'You're so old! How did you ever get along?'"

A federal judge's finding that Microsoft is a monopoly provided McNealy with ample material for his customary jabs at Sun's rival. If Microsoft ran Las Vegas, the slot machines would crash every fourth pull, the roller coaster at the New York, New York hotel would only go down, and the pirates at Treasure Island really would steal your money, he said.

In a press conference after the address, McNealy said he believes the most likely outcome of the Microsoft antitrust case is that Microsoft will be broken up into smaller companies.

"If I were a betting person, I would say they're going to break them up," he said.

Sun isn't being hypocritical when saying it's fine to make its StarOffice software for free, while at the same time criticizing Microsoft for competing against Netscape by giving its browser away for free, McNealy said. "One company is a monopolist, the other is not," he said. "Monopolists have different rules."

Comdex: Closing the millennium McNealy demonstrated his company's SunRay thin client, Sun's second attempt at selling devices that have only the most basic functionality. The machines fire up with an employee's computer desktop as soon as the employee inserts an identification card, and McNealy showed the computer rebooting in about five seconds and picking up right where it left off after he unplugged its power cord.

General Motors representatives also showed a Cadillac Seville with Java-based software called OnStar that can read email, calendar appointments and stock quotes out loud prompted by voice commands from the driver.

The OnStar system will appear first on high-end cars but eventually will spread to lesser models as well, the company said. In addition, GM will license the system to other car manufacturers.