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IBM 'in talks' to buy Sun Microsystems

Schwartz dives for cover in Big Blue

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It's become a truism that Schwartz has failed to protect Sun's proprietary high-end server business, failed to capitalise on the StorageTek product line of tape libraries and disk arrays and, the most damaging, failed to monetise Sun's vast numbers of free software downloaders. Will IBM do any better?

We could see how IBM could move around Sun lego blocks, merging some with its own, discarding a few, and coming up with a resulting product line-up that better equips it to meet and beat HP; respond to Cisco; have another go at Microsoft; gain revenue from Sun's vast download base; get a mainframe tape monopoly... and sell its own products into Sun's large customer base.

It would be a hugely consolidating move and better enable IBM to compete with Mark Hurd's HP which has emerged as its strongest competitor in years. The cost would be larger than the $5bn Cognos acquisition, but the potential benefits are larger too.

If an acquisition does happen it's likely that Schwartz will leave Sun, possibly along with many of his senior execs. He will, in the minds of many people, have failed at Sun.

The picture of IBM swallowing Sun will be, like that of HP gulping Compaq which in turn had eaten Digital Equipment, an iconic burial moment for the minicomputer and workstation boom of the Eighties. Only HP is now left of the band of silicon revolutionaries who set out to dethrone the mainframe - Apollo, Data General, DEC, Wang and the others who are now all gone. Mainframe survivor IBM absorbing Sun is an apt confirmation of its status as the survivor of the IT age.

IBM has issued a 'no comment' about any talks with Sun, which in turn has said: “As a matter of policy, we do not comment on market rumours about our Company.” ®

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