Sun turns WSJ into Novell buy spin machine

Schwartz plays the press


You have to give credit to Sun Microsystems' President Jonathan Schwartz. He knows how to play the media well. And one of his finest press goading moments since becoming Prez has come in the form of a non-story about Sun potentially acquiring Novell.

On Sunday, The Wall Street Journal captured some astonishing stuff coming out of Schwartz's mouth.

"We're one of the best-financed companies to pursue an aggressive acquisition strategy," Schwartz told the paper, adding that acquisitions are "a topic of daily debate" at Sun. This discussion apparently continued with Schwartz hinting at a Novell buy or the WSJ reporters using their powerful intuition to figure this course of action out.

We're sure that the thought of Sun making an acquisition is a shock to most of you - the only bigger shock being that Sun discusses these matters daily. We'd always thought of Sun's $7bn cash stockpile as something CEO Scott McNealy likes to roll around in on off days, not as an acquisition reserve. Heck, Sun has only made about 10 acquisitions in the last couple years. This places it well behind acquisition leader IBM.

But, sure enough, here is one of America's finest papers, saying Sun is indeed serious about acquisitions and then casually throwing out the Novell name to drum up interest in its story. The usual suspects in the IT media of course followed on the WSJ power scoop and did stories of their own.

And then we noticed that Mr. Schwartz - as the WSJ calls him - had put up this post on his glob on the same day that Novell non-story appeared. It's mostly a message about how IBM's vast investment in and commitment to SuSE appears to be backfiring. IBM has watched Red Hat out ship SuSE and seen Red Hat start to sell middleware that competes with IBM's WebSphere code. This, as Schwartz puts it, has "IBM finding itself in the uncomfortable position of having lost control of the social movement they were hoping to monetize."

In addition, IBM has spent far more money and time tuning Linux for its servers than tuning AIX for the same systems. Sun likes to say this, combined with the Red Hat sales, will leave IBM without operating system ownership - a real no-no for a company with such deep proprietary roots.

"IBM is in a real pickle," Schwartz writes. "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?"

Schwartz, of course, knew that us saps in the press would point to this line and wonder if he meant that Sun could somehow end up as IBM's master if it acquired Novell and the SuSE division.

But isn't this as much of a non-story as the original acquisition vapor quotation?

We doubt that Sun has plans to acquire Novell at all. If Sun is so interested in SuSE, why didn't it pick up the company before Novell? Sun's old Cobalt purchase proved it's not afraid to spend egregious amounts of money on a target, if it thinks it has to. And we doubt even more that IBM would be outbid by its much smaller rival. Not gonna happen.

Beyond all this, wouldn't Sun look pretty foolish buying Novell to spite IBM. Sun's the one saying Red Hat is the real Linux vendor. Sun would do more to hurt IBM's Linux play by picking up the successful Linux company instead of flirting with the "other open source meat." Speculation of a Red Hat buy, however, might have to wait until the first day of the next LinuxWorld, when Sun again looks to steal the spotlight.

In any case, the thought that Schwartz would announce Sun's confidential acquisition plans to a pair of hacks, setting up the potential for a rise in Novell shares and alerting the competition to its plans, is laughable. Thankfully, another WSJ reporter figured this out today and quoted an analyst who described the idea of Sun acquiring Novell as "silly." Maybe they can have a newsroom meeting over this issue and get their stories straight.

Yes, friends, this is Schwartz working the Sun tradition of tossing out a "controversial" non-quotation, knowing the press will jump on it. Schwartz must have looked into the WSJ reporters' eyes and known it was a slow news day. Good on him for that. Or perhaps, he's concerned IBM might buy Novell and wanted a chance at mocking the idea ahead of time and maybe even kicking Novell's share price higher.

If you're looking for real news, we remind you that drug dogs are dying from meth overdoses, the White House is chiding puppets and eco-tourists are dumping diesel off the coast of Alaska. ®

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