Sun-Microsoft Deal

The recent Sun-Microsoft detente (with Microsoft paying Sun USD 1.95 billion, Sun agreeing to drop all legal cases, and the two agreeing to share some technology) was a surprise. For Microsoft, the money is irrelevant, considering they make that much in less than 2 months. For Sun, which also announced layoffs and a bad quarter the same day, the money could help. As James Robertson puts it: “This is easily played as a win-win, but what it amounts to is the best that Sun could get from a really, really bad situation.” Adds Dan Gillmor: “The elephant in the room Friday, when Sun Microsystems and Microsoft announced their fairly stunning detente, was commoditization — the pressure from widely available, low-cost alternatives.”

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Rajesh Jain

An Entrepreneur based in Mumbai, India.