As I said before... Dell+Sun
Jan 17, 2006
9:45 AM EDT
|Dell needs Sun and Sun needs Dell.
These two need each other and therefore there should be an acquisition, merger or something here folks.
Sun is clueless about selling the commodity end of things (high volume) and Dell is clueless on the high end. Both have a deep seated hatred of Linux (yes.. even Dell.. though both seem to have engineers that are very supportive of Linux) business wise. Dell didn't do Opteron... which leaves them losing business to HP and (I guess) to IBM (though I wouldn't buy an IBM personally). Dell needs Opteron even on the higher end of "commodity" serving.. but it's too late to just start right now. The Sun platform under Dell would get the push it needed volume wise (volume).
In both cases were dealing with egos larger than the planet... larger even than perhaps Billy boy himself!
Sun wants to succeed, but won't admit that they absolutely STINK at high volume custom orders. Sun thinks that if they ship 1,000 units a day they're KING!. There are days when Dell sells 5,000 units in ONE HOUR.
Sun needs the volume game that Dell knows how to do... and Dell needs the high end stuff where they've never played before... and they need Opteron.
Why these two.. who obviously know everything I've written here, didn't get together boggles the mind.
In the end, HP (oddly enough) will make an extreme comeback (now that Carly is gone) and IBM's less than clear x86 line will also benefit. Dell will start asking for advice from Gateway. Sun will continue their slow death spiral.....
... and all because of pride. Ridiculous.
Jan 17, 2006
12:55 PM EDT
|Ok. Someone needs to grow up in the technology world. First of all, about the "high volume custom order". The key phrase here is "quality, not quantity". Sun will buy Dell before it ever even thinks about "merging". (Google Sun and Storagetek) How disgraceful. Do you people realize how far up Sun is above Dell, Microsoft, HP, Linux, etc? Too far up to be touched by any other company. Look at how much revenue Sun has every year and compare it to Dell's. Sun may not be experienced in the world of laptops, I admit. There are benefits. Top companies do not want Dell servers in their corporation. They want an experienced company that will take them to extreme levels. Big corporations don't want some dinky little company (Dell) that sells to the average Joe Blow. They want a powerhouse. Second, Sun is not on a death spiral. "In an unusual jump, Sun's stock rose 10 per cent - at the time of this report - to $4.84. SUNW is typically one of the most heavily traded stocks and moved today at an even more vigorous clip with more than 100m shares trading hand." Is that a spiral into darkness? How old are you? 10?|
Jan 17, 2006
1:18 PM EDT
|molly: anytime I see the "you people" phrase, I immediately associate it with aberrated thinking. It's the old "I'm OK and you're not OK" thing.
Your assertions seem pretty off target. Dell is by far the larger company, has the most cash, larger market capitalization. Dell: Price $30.38 market cap: $71.50 billion.
Sun: Price $4.61 market cap: $ 15.74 billion. So, Sun is going to use what to buy Dell? Schwartz's hot air? A loan?
The only thing I can imagine you attempted to do in your post is present a comedic performance. No other explanation exists.
And btw, the someone needs to grow up phrase: used recently by an descendant of Rip Van Winkle who thought it was 1998.
Jan 17, 2006
3:23 PM EDT
Your suggestion that Dell should buy/merge with Sun is impossible not so much because of the egos of the CEO's involved, but rather for sound business reasons.
Dell is a lean, focused company whose strengths lie in marketing (the famed "direct sales model") and manufacturing (the likewise famed "mass customization model"). They are not a technology company in the strict sense of the word, and to their credit they know it. You can see that clearly in the the insightful interview to Dell's CEO which appeared recently on eWeek (http://www.eweek.com/article2/0,1895,1907328,00.asp).
Sun, in contrast, is a diversified technology company.
They are very different, and their problems are very different, too. Integrating them is the worst possible idea, as it would create an unwieldy behemoth quite impossible to manage.
Jan 18, 2006
6:04 AM EDT
|It doesn't have to be a full merger. Could be that Sun licenses their Opteron platform to Dell plus some of their high end stuff. Dell becomes the seller front end that Sun lacks. Dell gets a high end solution that they've never had.
Folks... margins in the low end PC world (where Dell plays) are tight... very tight. Dell does well because even if you just make a penny on each platform, if you do enough volume (A LOT OF VOLUME) you can make it. Anyone who has tried to become a PC supplier will tell you that it's hard to compete because the margins aren't there for low volume sales. Of course, if you can find a niche, then you might succeed. Examples of such are Alienware (remains to be seen if this company can continue to sustain though).
As for Sun being a big guy that knows what they are doing, the ebay sales of their platforms proves otherwise. Sun sold servers and workstations (Opteron) on ebay for 4-10x LESS than their actual price. Great for the consumer that bought, horrible for Sun because it set the price level expectation.
The new Ultra 40 workstation seems to be a WHOLE lot cheaper made than its predecessor, the w2100z. IMHO, either Sun realizes they created a low price expectation and is trying to create a platform closer to the target they created with their eBay sales... or they simply see that at low volumes they need to figure out how to increase their margins. Either way, it's not going to be enough. Especially with their mixed message (love Linux, hate Linux, love Opteron, love SPARC only). Granted, Sun lost their workstation appeal quite some time ago (the market that was the only reason for Sun's success at one time)....
You also need to remember that Sun and Microsoft still have a partnership (even though I hear it is going well... pride again)... so Sun wouldn't mind an arm selling their wares with Windows on them. Something that Dell is ALL about. Sun makes sure that their Opteron platforms are WHQL certified. Dell could be the arm to make that market happen.... and it gives Dell a quality Opteron platform FAST.
Intel's horrendous roadmap is another problem. If you're an HP/IBM/Dell... do you like the fact that Intel is going to have 3+ MAJOR architecture changes on their line??? The big companies like stability so they can deliver a platform with services. Now... it's not that they don't want to sell you a big server EVERY year as the architecture changes, it's just that the big boyz figured out that doesn't work revenue wise. Intel's roadmap mess makes the long winded Opteron platform more attractive. If you look at HP's platform roadmaps you'll see that they're support plans on the Opteron side go out to infinity right now... not so with the "catch up to AMD" plan of Intel.
Sun is NOT that diversified btw. They are not DEC, they are not HP, they are not IBM... all of which were/are much more diversified. Sun is primarily a workstation and server supplier.... I'd say 90% centers around that and the software and services for that.
Also, it's clear that Sun can't play their same old game. This why the former HATER of M$, shook hands and kissed them a couple of years ago. Sun is looking for allies on their war against Linux. Dell would make a formidable ally.... and a natural choice since they are joined to Microsoft at the hip.
I still believe there will be an announcement on this shortly. To me it's just too obivious.
Jan 22, 2006
8:17 PM EDT
|Sun really has no clue where they're going. Now, I'm not saying they don't do things well. That's not true at all. Where their problem lies is direction.
Over the past few years they've had a real issue with what they'd like to do with the company, how this whole "Linux" thing impacts their business, and where they go from here. I don't think it's settled out either way still and the kinda-open-source Solaris is a decent indication of this. The only reason I can think of for it is to create a Linux-alike and try to siphon off Linux/BSD developers.
But are they a hardware outfit? Service outfit? Do they sell their expertise or a finished piece of hardware? Where IBM has decided to go all service (even their fabs rent out, VIA's C7 is produced in Fishkill. Cell is a design exercise.) and HP has gone all PC hardware (well.. mostly. No Alphas.) Sun is still on the fence. That more than anything makes customers a bit antsy.
But what would they offer Dell? They do have high end server hardware, true. But the x86 boxes are pretty well caught up with SPARC equipment. And why not use, say, PPC or the new Cell architectures if you're going with really massive machinery. Why use the dated (unless they've released new chips recently) Sun SPARCs? Looks like Sun has 4 entries in the top 500 computers list, and 3 of those are Opteron clusters.
An interesting note is that Dell rides far higher than Sun on that list. Number 5, actually. Could be that Clusters make the "single box" sales irrelevent.
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