If you've been scanning the newswires much at all this week, you may have spotted a huge mound of speculation around whether Sun is about to buy Novell. Leaving aside the question of whether Novell is up for sale anyway, to find out where it all started, the place to look is Sun CEO Jonathan Schwartz' blog.
Schwartz blasts IBM, one of his company's major rivals, with a cannon-full of abuse. Much of it relates to IBM's adoption of open source when IBM was, as he puts it, at one time "the world's most pernicious patent litigator". Disingenuous in the extreme, one might argue, when Sun has not been shy of suing others, including Microsoft, whom it deems to have infringed its patents. Sun was even investigated in 2001 for whether it illegally kept patents secret while at the same time helping to set industry standards for related products. Even more unbelievably, Sun was patented on the dot in dot com in 2000.
But that's more of a side issue. Schwartz follows this tirade by urging IBM customers buying into Big Blue's position as a Linux advocate to think about the extent to which IBM and Red Hat will lock them into their "expensive" offerings.
Then we get to the nub: "IBM is in a real pickle. Red Hat's dominance leaves IBM almost entirely dependent upon SuSe/Novell. Whoever owns Novell controls the OS on which IBM's future depends. Now that's an interesting thought, isn't it?", he continues. He follows it up by concluding that even if IBM bought Novell, it would be in a vulnerable position because it would be open to attack by Sun's open Solaris and Java Enterprise System which, Schwartz says, "gives us a significant - and sustainable - competitive advantage." He finished up with: "If IBM acquires them [Novell/SuSE], the community outrage and customer disaffection is going to be epic... but where else does IBM go?"
You might reasonably conclude that there's little love lost between Schwartz/Sun and IBM. But it's this paragraph that has led to speculation that Sun might either make or be making a bid for Novell.
Questions to be asked include:
Q: Is Sun attempting to distract from Novell's successful SuSE Linux distro?
A: Undeniably - Novell has garnered a huge amount of positive feedback from its move into the Linux business - unlike the last time it attempted a shift into the desktop and Unix markets, and Sun is launching a raft of new products at the LinuxWorld show in San Francisco this week.
Q: If IBM became so vulnerable through a Novell acquisition, why would Sun bother to buy it instead? Why not wait for Big Blue to fall to its knees?
A: One in the eye for IBM would clearly please Mr Schwartz and, as would see it, weaken the position of a key rival. So from Schwartz' position, taking out Novell, now a major player in the Linux market, makes a lot of business sense. Sun probably doesn't believe it has time to hang around waiting while IBM dies a long and painful death. Anyway, it's best to hedge your bets.
Q: Can the profit-free Sun afford it?
A: Although it enjoyed a profitable fourth quarter, the company announced a net loss for the fiscal year 2004 of $376 million. That said, it also reported a balance of cash and marketable securities worth $7.608 billion and Novell's market cap is a mere $2.68 billion as of 3 August 2004. So yes, Sun has the cash.
Q: Is Novell for sale?
A: Everything's for sale if the price is right.
It looks as if the stage is set for a battle royal. The main unanswered question is why Schwartz would flag it up so publicly. It might be kite-flying to force IBM's hand, although hubris might be more likely - Mr Schwartz is no stranger to the concept.
Whichever is true, Schwartz' blog has got people talking about Sun. Which, of course, was the point of it in the first place.