There has been much speculation in the media about a possible merger between Sun and IBM. Greg Schulz, an analyst with StorageIO Group (Stillwater, Minn.), thinks the deal will happen.
"It's not a matter of if; it's a matter of when and what and how much i.e. whether IBM only buys some pieces of Sun or buys all of it," he said.
Dan Olds, principal at Gabriel Consulting Group (Beaverton, Ore.), on the other hand, leaves some room for doubt about the prospects of a binding agreement.
"There's a better than 50-50 chance that the deal will actually happen," he said. "According to published reports, HP, Dell and Fujitsu have all turned down the opportunity, leaving IBM as the last and probably best option."
So what does all this mean to IT? Both firms have massive server and storage inventories and huge installed customer bases. In some cases, the product offerings are competitive and in others they are complementary. Let's take a look across the range.
Schulz expects IBM to retain most, if not all, of its server portfolio and associated software despite a Sun deal. And that means big shifts for existing Sun customers.
"I could see IBM potentially selling off the SPARC processor technology to a third party, such as Fujitsu, or a chip manufacture, such as Intel or Broadcom, similar to what others like HP have done in the past after similar acquisitions," he said.
Olds, though, envisions Sun's standard SPARC-based platforms gradually being subsumed into IBM's POWER-based gear over time. To do this, and preserve Sun's customer base, that would mean integrating Solaris and AIX into a common code base.
"A blending of AIX and Solaris that would run on RISC and x86 processors could be a very compelling combination for customers who are looking to simplify their environments," said Olds. "Sun's Niagara-based systems stand the best chance of being developed further in a combined IBM-Sun company, as they are unique and have a value proposition that isn't duplicated by existing IBM systems."
On the x86 side of Sun's server business, Olds also predicts Big Blue will retain some of Sun's more unique offerings the Thumper storage/server line, for example. Schulz concurs.
"The Sun data storage servers like Thumper could find a role in the IBM lineup for hosting Sun open source software, as well as being a platform for IBM and partner-based software," he said.
On the Sun software front, he reckoned IBM will continue to leverage Solaris in some shape or form for some time, given the installed base, while providing migration and consolidation paths. It will also offer cloud and other hosting or managed services for Solaris customers, including those on IBM virtualized server platforms from the Intel-based System x to the mainframe System z. Interestingly, Sun and IBM already have programs in place where Sun Solaris can be moved and consolidated onto IBM mainframes.
Olds, however, is more hopeful about the fate of Solaris.
"IBM would get an interesting x86 gambit with ownership of IBM's Solaris x64 operating system and virtualization products," he said. "This may be persuasive to ISVs and convince them to port to the OS in greater numbers."
Another possible angle on all this is IBM harnessing Sun's MySQL by wrapping some cloud, SaaS and other managed services around it to stir up the pot against the likes of Oracle or Microsoft SQL while preserving footprint and revenue for IBM database products like UDB and DB2.
"With DB2 and MySQL, IBM gets to have it both ways with its enterprise customers that are now looking more seriously at open source for production apps because the current economy has left them resource constrained," said John Webster, an analyst with Illuminata (Nashua, N.H.). "If DB2 customers are looking seriously at MySQL as a lower-cost alternative, IBM would at least own them coming and going."
It's perhaps the storage side that will see the most fireworks, as there is more than a whiff of monopoly in some market segments, not to mention a large amount of product overlap. The complete IBM storage line up, of course, will probably remain intact. At the high end, in particular, IBM has its own mainframe-based storage with the DS8000, whereas Sun resells a Hitachi solution.
Otherwise, both Sun and IBM OEM their entry and enterprise midrange storage from LSI, so there is no real conflict there. Similarly, on the virtual tape library (VTL) side for open systems, both have leveraged Falconstor, although IBM recently bought Diligent for VTL a solution that also has the much in demand deduplication technology. In addition, Schulz thinks IBM will probably continue with its OEMing of NetApp-based N series while boosting its own capabilities by combining the best of Sun/IBM hardware and software technologies for NAS as well as object-based and archiving solutions.
The tape side, however, is where things could get really contentious and possible fall afoul of regulators. Uniting Sun's StorageTek holdings with IBM's considerable tape offerings give the resulting firm a huge market share and control over much of tape landscape. This may not pass muster with the DOJ.
If that regulatory minefield can be negotiated successfully, there might well be major Sun casualties in the StorageTek line. However, Olds said he believes Sun's low-cost 'open source' storage line will survive as it can be used as a weapon against major competitors such as EMC.
"I can also see them keeping and developing some of Sun's more exotic storage technologies, like the massive Hydra infiniband switch that is currently being used in huge HPC installations," said Olds. "But much of Sun's conventional storage product line is duplicated by current IBM offerings, so these would certainly go away over time or be blended into IBM's product line."
Happen or Not?
So will it happen or not? Webster points out that some have been scoffing at this deal, claiming IBM is interested in only disrupting a supposed deal with Dell. He isn't so sure about that scenario. Certainly, from the Sun side, its investors and top management appear to be set on making some kind of a deal happen.
"If the IBM/Sun deal craters, Sun is left in a diminished state," he said.
And it if does go through, get set for a whole new ball game in the server marketplace, particularly on the x86 side.
"A combined IBM-Sun could present a whole new competitive challenge to HP and Dell," said Olds.