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What an IBM-Sun Deal; Is this deal a good one?

By Amarendra Bhushan for CEOWORLD Magazine Updated:March 19, 2009

Web powerhouse Sun Micro poised at brink of IBM.

Why IBM can not fight MS or Google? I would buy Yahoo than SUN? Hey, why IBM can not build one like Yahoo?
Is it a bad idea for IBM to buy Sun?

Twitter is hot once again this morning, this time over ‘IBM-Sun Deal’ I am not able to comment on the authenticity of the gossip itself, but it’s clear that Sun needs to do something in order to build up its position in a competitive market. Selling to IBM is certainly one way…

I believe that IBM may want Sun to consolidate its position in the virtualization and cloud computing space before Cisco Systems gets any market share with its upcoming Unified Computing System. But the Cisco involvement in this bid be be much deeper than that.

IBM buying Sun is like Microsoft buying Apple, it would kill server hardware competition.

Other hand, It’s not clear how the Sun Storage Cloud and Compute Cloud would fit into a larger IBM/Sun company, if the rumored acquisition does occur. But cloud computing services and the infrastructure needed to support them will likely be crucial to both companies going forward, whether they enter into an acquisition deal or not.

A number of people (like Om Malik at GigaOM) believes that Sun belongs to Cisco much more than to IBM. ” The problem would be running the place, as anyone who bought it would be taking on a serious management challenge. Still, I can name a few potential suitors — Hewlett Packard, Dell, Juniper Networks or Hitachi, or even private equity guys (led by former Sun co-founders) — that would be up to the challenge. Damn, if I had the money, even I would try to buy it.”

Paul Murphy writes “The bottom line for IBM is that buying Sun is a cheaper and more permanent way of killing it than competition – meaning that you can hope that IBM would treat Sun the way they have Lotus, but they’re a lot more likely to treat it the way their proxy, Exxon, treated Zilog or the way they themselves treated Informix.”

Here’s a look at the server market share standings:

- IBM has major server lines running a variety of operating systems–AIX, zOS, IBM i, Linux, and Windows–on three major processor families.

- IBM needs Sun’s Sparc processor and Solaris operating systems.

- IBM or Sun could sell or license the Sparc line to Fujitsu.

- Sun has x86 servers using chips from Intel and AMD, Niagara and future Rock processors.

Ah yes one more thing… wasn’t Sun the anti-IBM not so so long ago? Actually smart consolidation

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