Sun gives away enterprise software to challenge Microsoft
INQ7.net
December 1, 2005
http://news.inq7.net/infotech/index.php?index=1&story_id=58431

	In a somewhat apprising, yet not unprecedented move, Sun announced that it would
open its entire enterprise software line and give it away for free.  This does not
mean that Sun is open sourcing the suite of software, however, they are not planning
to charge people to download and use the software.  Sun has done this before with the
Solaris 10 operating system, so it is not unprecedented.  However, the scope of the
free software marked by this announcement is impressive.
	The move is pitched as a strategy to go after Microsoft for control of the next
generation platform.  The concept of enterprise services replacing traditional licensed
software has received a lot of hype recently, and many big players like Sun, Microsoft,
and IBM have been jockeying to control the platform.  This move makes a strategy by
Sun to attempt to capture the platform by giving it away, much as they did with the
popular Java language.  Much as IBM has recently touted its success at transitioning
to a service based company, Sun also sees that the future revenue streams will not
come from licenses for underlying system software, but rather from services that
are built upon them.  While Microsoft has made lots of money licensing its operating
system in the past, the benefits of controlling the platform have gone way beyond
the revenue directly from licensing.  Sun has recognized the importance of this,
and in this announcement is showing a willingness to strike first to try and
capture the market.
	There is, however, a catch in Sun's announcement.  In an acknowledgement of
the new service and support revenue model, Sun has said that it will not provide
any support for the free versions of the software.  This is very similar to the
fairly successful Red Hat revenue model which relies on customers paying for a
supported version.  Although Sun touts this as a "radical" strategy, some of the
aspects of their strategy are nothing new.
	This is interesting in light of several topics in the class.  First is the
"open" business strategy.  While they don't go so far as to open the source code
for the product, they recognize that getting people to use the platform for free
will encourage growth and help capture the market.  This is also interesting in
terms of our pricing and lock-in discussions.  This uses a fairly old tactic
in pricing (give away freebies) but does it on a much larger scale.  As for
lock-in, this is clearly an attempt by Sun to capture the market for enterprise
services by getting people to use and innovate on their platform.  One more
interesting point is that although the goal of this is to get Sun's platform
used, it is in some ways irrelevant given the goals of web services.  The
ultimate goal is interoperability through exchange formats like XML, so
in the end if the technology works as it should, who controls the platform
shouldn't really matter (although we all know that this is perhaps unrealistically
optimistic).