What the company hasn't said is what products will be affected, how research and development will change, and whether customers will be dealing with different Sun representatives after the layoff of 11 percent to 13 percent of its employees.
In his announcement of the moves to financial analysts last week, Sun CEO Jonathan Schwartz pledged that customers will not be affected by the cutbacks. Schwartz contended that the changes will improve the company's focus on core products.
Analysts were skeptical of Schwartz's pledge and predicted that Sun's customers will see changes such as potential cutbacks in sales support. Meanwhile, Sun users are simply hoping that the company will provide more details about how the cutbacks may affect them. "It's cloudy for all of us," Brian Conlon, CIO at Washington-based Howrey Simon Arnold & White LLP, said of Sun's plans. But Conlon, whose law firm uses Solaris-based UltraSparc systems to run its ERP and financial applications, said he remains committed to Sun. "For availability and reliability, it hasn't changed -- we're still big fans," he said. Based on what he gleaned from a meeting with Schwartz last year, Conlon said, "I think Jonathan has a pretty clear understanding of what he needs to get done, but a lot of us are foggy on the details." Conlon said the layoffs could make the company leaner, and may reflect overlap from the StorageTek acquisition.
Chuck Sears, director of research computing at Oregon State University in Corvallis, which has more than 100 Sun Opteron-based servers, added, "We all look forward to future clarification" about Sun's plans.
Sears said he hopes that the moves won't slow Sun's effort to integrate its computer, storage and networking systems, so he can devote resources to research rather than to improving systems integration.
Sun declined to specify what products will be affected by its streamlining, other than to provide a written statement that "the company has not identified products or projects that will be affected at this time."
"There was very, very scant information provided that would allow us to go through an analysis of what the effect is going to be on Sun's products," said Paul McGuckin, an analyst at Gartner Inc.
Between the lines
But analysts did make some assessments based on what Schwartz didn't say.
For instance, Schwartz told financial analysts that Sun will focus on network computing and cited several technologies "that represent the future of such system innovation." His list included the UltraSparc eight-core Niagara servers, some new StorageTek storage tape drives and "Thumper," a soon-to-be released Opteron-based product that combines servers with storage.
Including the Thumper technology in Sun's future plans "calls into question some of Sun's other storage products, which are based upon proprietary technology," McGuckin said. Those proprietary storage technologies "are going to get more scrutiny and perhaps cut," he said.
"What we're telling clients is any road map dependencies that they have, they should get written commitments from Sun," McGuckin said.
Schwartz took leadership of the company on the same day it posted a fiscal third-quarter loss of $217 million. Despite the loss, Sun officials expressed optimism about the future, pointing to a 21 percent increase in revenue during the same period, to US$3.2 billion. The acquisition of Storage Technology Corp. last August helped to boost revenue in the quarter.
Analysts had expected substantial layoffs, though Schwartz had said in April that the company may only need some "pruning."
"Customers can expect some consolidation in their sales force, and they are going to find it harder and harder to get a specialist," predicted Susan Aldrich, an analyst at Patricia Seybold Group in Boston.