Schwartz slams HP, IBM reliance on third-party OSes

The unwavering faith that Sun Microsystems president Jonathan Schwartz has in the company's successful future comes down to one product.

That is the Solaris operating system, which means that of the big four vendors which play in the x86 space, Sun Microsystems is the only one that doesn't have to rely on Windows or Linux.

"What's particularly interesting is that [when] you look at x86 servers you can see that we have an operating system, Microsoft has an operating system, and largely Red Hat has an operating system and HP doesn't and nor does IBM," Schwartz said.

"So we believe we are at the beginning of one of the single biggest competitive windows in the history of Sun where we can now begin pricing and evolving technology in a way that neither HP nor IBM can possibly keep up because they have taken a short cut with 'let's throw away our operating system' in the hope of pursuing a partnership with Red Hat, which I think is great for Red Hat. I just wonder what it does for HP or IBM."

Speaking to Computerworld during his first trip to Australia, Schwartz said Sun's innovation strategy is very different compared to HP or IBM.

"If you look at HP they're trying to become Dell," he said. "They're, despite their tagline, moving away from invention, they're moving towards resale. And if you examine, for example, the choices they've been making they've moved away from microprocessors to support Itanium, and they've moved away from the evolution of their hardware systems to instead simply resell what an OEM builds for them."

Schwartz said HP now resells flat-panel TVs and printer ink and that the company is "becoming a channel company".

"When it comes to x86 systems we are building everything but the microprocessor, and the single biggest investment by the way, is in an operating system which we are in the midst of open sourcing," he said.

"Now compare that to HP. HP doesn't build the system and doesn't build the operating system so that is the starkest contrast I can identify. That's why I believe we can achieve greater margins over time because, in general, R&D should equate to greater profitability because of the technical competitive advantages."

Regarding IBM, Schwartz said IBM is a "very inventive" company but it is historically known for making "incredible strategic gaffes".

Schwartz said his favourite is IBM's reliance on Microsoft for PC operating systems and, as a result, Microsoft became more valuable than IBM.

"Well, round two of that same opera was that they thought Linux was going to boil all the oceans and cure all the cancers. And it was a wonderful concept as a social movement but the pragmatic reality is that you have to buy a product from a company," he said.

"So while IBM was saying 'Linux solves all of our problems' it failed to notice that Red Hat was beginning to erode its relationship with its customers. Now, if you're going to talk about Linux, why on earth would you talk to IBM? Because it has no skin in the game, it's just a box shifter. You talk to Red Hat. And so how does that now represent IBM's investment in R&D. It doesn't, it represents its investment in rhetoric and resale which I think is going to be a tough competitive posture for it to take when we go into its accounts and say we'd like to move you onto our full line-up of x86 Opteron systems running the single most secure scalable and performing operating system available, Solaris 10. And by the way, it's open source."

Click here to read the full transcript of the Schwartz interview.

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