Sun Just Wants To Get Along

• By Ed Scannell
• 09/13/2007

In yet another noteworthy win for the Wintel Duopoly, Sun recently deepened its alliance with Redmond, signing a deal that will see the company build x64-based servers with Windows Server 2003 tightly bundled in. No longer will Sun users have to separately purchase and install the server-based operating system on their own.

The deal extends Microsoft's reach even further into the rather profitable server world because it now has direct access to Sun's users. According to figures from IDC, Sun remains the planet's third-largest supplier of servers with a 13 percent share of the worldwide market, behind IBM and Hewlett-Packard. Hardly chump change.

"This latest collaboration [between Sun and Microsoft] reflects the demands of the company's joint customers, the increasing pragmatism of the vendor's respective leadership teams, and the growing maturity of the IT marketplace," said Dwight Davis, vice president of Ovum Summit. "With Sun noting that 100 percent of its Solaris customers use Windows, it only makes sense for the two vendors to ramp up their cooperation on some fronts, even as they continue to battle one another across a wide range of products and markets."

The announcement also helps the companies nudge their respective virtualization strategies along. They each pledged to ensure their operating systems would work and play well with the other's key virtualization technologies. This could prove to be yet another important boost for Microsoft as it tries to climb higher in the data center, where an increasing number of IT shops are looking at consolidating older servers to simplify operations and reduce energy costs.

Virtually as Big as Microsoft?
The fever pitch over virtualization -- something we've been writing about in Redmond Report all this week in connection with VMware's VMworld 2007 conference in San Francisco -- may have reached a peak yesterday. Swept up by the recent and lavishly successful IPO offering of VMware, and the development support being pledged to the technology by the largest of industry giants, some analysts yesterday predicted VMware's future is so promising it could become as strategically important to the overall industry as Microsoft.

Whoa. Someone needs to switch to decaf.

True, VMware's IPO raised $1.1 billion and was one of Wall Street's hottest offerings of the year. In fact, it was the best showing since Google's IPO over three years ago. The company's market worth, now approaching $30 billion by some estimates, is worth more than Microsoft, Oracle and SAP combined, a couple of analyst firms point out.

True, in recent estimates IDC predicted that spending on virtualization software and services will spill over the $15 billion barrier worldwide in 2011, up from $6.5 billion in 2006.

True, leading industry executive Hector Ruiz, CEO of chip maker AMD, was quoted in published reports this week saying, "Virtualization has reached a tipping point." Other executives and analysts also said this week that virtualization's technology curve has now reached a point where it's cost-effective for everyone and its productivity benefits should be obvious to any and all skeptics.

VMware President Diane Greene told VMworld 2007 attendees this week: "A year ago, we were talking about virtualization becoming mainstream...now, we are talking about a virtualization industry."

Yep, some pretty heady stuff going on here. But VMware becoming as important to the industry as Microsoft?

First, Microsoft will do its damndest over the next few years to make sure that the next Microsoft of the software industry is Microsoft. The company has already made it clear that it plans to play hard in the virtualization market, and that the technology will be integral to future releases of its core operating systems and applications.

Along with Microsoft, there's an impressive list of top-tier vendors -- including IBM, Hewlett-Packard, Intel and Cisco -- who also plan to claim a piece of the virtualization market over the next few years.

There's little doubt that VMware's future is shinning bright. But whether this moment is just a day in the sun, we'll have to wait and see.

Report Says Microsoft Engaging in 'Stealth Patching'
Microsoft once again appears to be stepping over the line. Reports yesterday say Redmond is patching files on users' Windows XP and Windows Vista machines without first notifying them. Microsoft has been able to do this even when users have switched off Windows' auto update capability.

One of the dangers here, of course, is that many companies' IT departments need to test updates of any kind before they can be deployed. Not good.

Apparently, according to Scott Dunn who reported this in the Sept. 13 issue of the Windows Secrets newsletter (http://www.windowssecrets.com), Windows Update started changing files on users' systems without showing a dialog box that requests users' permission to do so. So far, the only altered files reported are about 18 smaller executables that are used by the Windows Update (WU).

According to the newsletter, the only attempt at an explanation from Microsoft about this can be seen on a Microsoft Community Forum site offered by a user called "Dean-Dean." In a post, Dean-Dean stated:

"Windows Update Software 7.0.6000.381 is an update to Windows Update itself. It is an update for both Windows XP and Windows Vista. Unless the update is installed, Windows Update won't work, at least in terms of searching for further updates. Normal use of Windows Update, in other words, is blocked until this update is installed."

Not exactly a clear explanation of why Microsoft would engage in this sort of undercover practice. What has made some people apprehensive about this is how Microsoft could use this method of "stealth patching" in the future.

Mailbag: iPhone Correction, AMD vs. Intel
In yesterday's Redmond Report, we incorrectly stated that Steve Jobs expected to sell 100 million iPhones in 2008. In fact, the correct number is 10 million. Thanks to Dana for bringing it up:

"100 million iPhones in 2008"? Not as long as it is locked to ATT cellular service. I'm not sure how many cell phone customers there are now, but in 2004 there was somewhere around 180 million of us. 100 million sounds like a pretty unreasonable share of the market for a single carrier -- somewhere close to 50 percent.
-Dana

Where do you stand in the chip war between AMD and Intel?

I must admit I am very much an AMD person. I am an IT consultant and I recommend AMD over Intel to many users every day. Not because of benchmarks (which do show AMD is better in power consumption -- Opteron, at least), but because of the almighty dollar. The fact is, AMD is simply a better chip per dollar than Intel. I know Intel is beating the pants off of AMD in the benchmarks, but I would rather have a fast processor with money left over than a really fast system and be broke over it. Intel doesn't offer anything unless you are doing very high-end and specialized tasks (i.e., cad/professional video editing). For the average user and most gamers, AMD is still the choice, if for no other reason than its cost. I can wait five or 10 extra seconds to burn a DVD if I saved $150 on my CPU. With the money saved, I can put that into other areas of my system, like a better board or bigger hard drive.

Obviously, I am pro-AMD but I will give credit where credit is due. Intel has come up to be a good competitor, and that competition is always good for the consumer. Though I don't think I will be buying anything Intel in the near or distant future.
-Donald

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