SUN MICROSYSTEMS: Sun Microsystems: the company that changed
the world and then disappeared into thin air.
We all know about revolutionary tech inventions like the iPhone, the computer, the internet,
and the cloud, but these were the guys who made each and every one of these inventions
what they are today.
For example, they’re the ones who created the Java programming language.
While Java has declined in popularity in recent times, it’s still one of the most influential
coding languages in the world.
It’s used in everything from laptops and computers to gaming consoles, smartphones,
and data centers.
Not to mention, thousands of languages and platforms have been heavily inspired by Java.
Likely the best example is Android.
In fact, Google ended up fighting a several year long court battle after copying Java
code into Android.
But, Java was just one of Sun’s many innovations.
Sun is also the ones behind SPARC or scalable processor architecture.
Again, this is probably something that most of you have never heard of, but SPARC revolutionized
chip design.
With SPARC, Sun basically figured out how to triple the number of instructions sets
that a given chip could handle.
And it wasn’t long until this technology made it’s way into opensource projects,
super computers, and basically became the new gold standard for chip design.
Speaking of gold standards, Sun also set the gold standard when it comes to enterprise
software.
Solaris is a Unix based operating system that was created way back in 1993.
But, to this day, Solaris is the go to OS for powering backend infrastructure.
They’re basically the windows of the backend.
But, all of that is just a handful of Sun’s contributions.
They also played critical roles in the development of virtual computers, virtualization, cloud
computing, database management, super computers, and so much more.
But, despite their monumental role in tech, not many people are familiar with Sun today.
This is primarily because Oracle bought Sun in 2009 and they basically killed the brand.
But, while the Sun brand may no longer be a thing, there’s no question that their
inventions and innovations will live on decades if not centuries.
So, here’s the story of the company that changed the world and then disappeared: Sun
Microsystems.
FOUNDING SUN: Taking a look back, the story of Sun Microsystems
can be traced back in the early 1980s to a Stanford PhD student named Andy Bechtolsheim.
Andy was nothing less than a tech genius.
At Stanford his main project was creating a powerful network that could link the various
departments of the university.
He called this network the SUN workstation with SUN standing for Stanford University
Network.
This network was extremely complex for the time and required several managers, engineers,
and support staff, but it also linked together computers like never before.
Fun fact, two of these managers would steal this tech and create Cisco which would go
onto be the world’s largest company but that’s a wholenother story.
Going back to Andy, while he was a genius, we can’t give him all the credit as he did
have a bunch of help from our good old friends Xerox.
Xerox was honestly just idiots.
They had no conception what intellectual property was or why they should protect IP.
One of the most notable examples of this was their no fee consultant program.
Essentially, instead of paying consultants with cash, Xerox opted to give consultants
free access to their research.
You can bet that Andy leveraged this program to the absolute max when creating the SUN
workstation.
Almost instantly, the SUN workstation attracted a bunch of scientists and engineers who were
willing to pay big bucks to use the workstation.
So, Andy would nonchalantly price licenses to his workstation at $10,000 each.
That’s equivalent to $33,000 today.
Little to say, Andy was racking in the dough in 1981 and it wasn’t long until he drew
the attention of a few MBA graduates: Vinod Khosla and Scott McNealy.
Basically, they told Andy, “What you have here is great, but join us and we can make
this revolutionary.”
And that’s exactly what they did.
On February 24, 1982, the trio would establish SUN microsystems based on the SUN workstation.
Bill Joy was one of the first employees to join the company and he has since been credited
as a cofounder as well.
And with that, Sun was in business.
They began selling their Sun-1 and Sun-2 workstations which were largely inspired by Andy’s original
workstation, and let’s just say, these sold like hot cakes.
Basically every university in the world wanted one of these workstations leading to $8 million
in sales in the first year alone.
Also, we should note that unlike many startups today that burn money for decades, Sun achieved
profitability within its first quarter.
This gave them quite a bit of leverage when it came recruiting the best talent.
One of their first hires were Eric Schmidt and Carol Bartz.
If you’re not familiar with these two, Eric would go on to be the CEO of Google and Carol
would go on to be the CEO of Yahoo.
So, Sun had a pretty strong team to say the least, but they were just getting started.
Virtually all of their revenue was coming from universities and research institutions,
and while that was already super lucrative, they knew that the real money was with companies
and that was their real target.
THE BRIGHT SUN: Hearing about all these super successful people,
I know a lot ya’ll wonder why they never stop to just enjoy life.
For example, why did Elon gamble his PayPal money on Tesla and SpaceX and why is he still
working 120 hours every week.
Well, I don’t know the answer to this, but what I do know is that one of Sun's founders,
Vinod Khosla, would do exactly what ya’ll have been dreaming about.
Just 2 years after founding Sun, at age 29, Vinod would become a multi millionaire and
he just straight up retired.
Since then, he would just spend his time investing in startups which has made him a multi billionaire.
So, looks like Vinod was able to get of the hedonic treadmill early on, but the rest of
Sun was just getting started.
Sun would turn their focus onto design companies that relied on CAD models, specifically Computervision.
Computervision already had a contract with Sun’s biggest competitor: Apollo Computer.
But, Sun wasn’t willing to accept this as a lost opportunity.
They would aggressively pitch Sun and make offers over and over and over again until
Computervision finally agreed to give them a shot.
For Computervision, Sun was just one of their dozens of backend partners, but for Sun this
partnership was gamechanging as it established them as a reputable player.
Other companies started thinking: If Sun is good enough for Computervision, it must be
good enough for us too.
And this was exactly the push Sun needed to break into the enterprise market.
There was only one more major market left: governments.
In 1984, Sun would open a new subsidiary called Sun Federal and it accomplished exactly what
you would think.
It sold workstations to the government.
Given that Sun already had quite a bit of notoriety amongst schools and companies, breaking
into the government market wasn’t too challenging.
In fact, by 1991, Sun was delivering over half of all workstations ordered by local,
state, and federal governments.
All of this allowed Sun to become the fasted growing American company between 1985 and
1989 averaging growth of 145% per year.
This meant that Sun was able to achieve $1 billion worth of revenue within just 6 years
of being founded.
Clearly, Sun was a serious a company that had a stronghold in a multitude of markets.
But, it’s what Sun would do next with all of this influence and power that really made
them legendary.
THE SUN NEVER SETS: As companies mature, they usually get greedier
and greedier.
They become enthralled in trying to maximize market share, maximize profits, and maximize
the stock price.
Of course, Sun also wanted to accomplish this, but giving back to the tech world was arguably
of equal importance for them.
One of their first revolutions was the Network File System or NFS in 1984.
Before NFS, file sharing systems were usually limited to specific processors and specific
operating systems.
Companies did this to maximize the sales of their own hardware similar to what Apple does
today.
But, Sun threw this ideology completely out the window with NFS.
NFS allowed for data sharing regardless of processor type, OS, or communication system.
Unsurprisingly, this became the industry standard within no time leading us to SPARC.
Until the introduction of SPARC, virtually all chips were built on CISC or Complex Instruction
Set Computing architecture.
SPARC, however, was based on RISC or Reduced Instruction Set Computing architecture.
RISC was not only more powerful and cheaper, but more importantly, it was magnitudes more
scalable, so switching to SPARC based workstations was a no brainer for customers.
But, Sun didn’t just stop right there.
Naturally, when you have control of such technology, you’d want to patent the hell out of it
and make sure that no one else gets access to it, but Sun would do the exact opposite.
In fact, Sun would begin licensing their RISC design to other chip makers for cheap prices
before they even launched their own RISC based workstation.
Their reasoning was that if they really wanted to push forward the tech industry and make
RISC the new standard, they needed all the help they could get.
It doesn’t stop right there either.
Sun would actually go on to handover the rights to SPARC to a non profit organization that
was jointly owned by a bunch of computer companies.
To be honest, I can’t think of another tech giant that has voluntarily given away such
technology since then.
Let me know if you can think of one in comments below.
Anyway, all of this brings us into Sun’s most notable contribution: Java.
Java was the brainchild of Sun engineer James Gosling with substantial support from Sun
CEO Scott McNealy.
Scott believed that personal computers were just a blip in history and that the real invention
network computing.
Back in the 1990s, he predicted that everything from refrigerators and telephones to credit
cards and door locks would all be connected by a network.
He wanted all the backend infrastructure that was powering these technologies to be run
on Java, and to accomplish that, in classic Sun style he would opensource Java.
Let’s just say, Scott was spot on with his vision and he more than accomplished his goal
with Java.
It looks like giving away all this tech didn’t take away from Sun throughout 90s as Sun would
achieve a peak market cap of $200 billion.
But, unfortunately, the Sun would eventually set.
A SUPERNOVA: The bottomline is that all of Sun’s generous
sharing eventually came back to bite them.
You see, even though Sun opensourced a bunch of their greatest tech throughout 90s, it
didn’t really hurt them then because companies would opt to buy the official Sun version
of the product.
This was thanks to loads of VC funding and entrepreneurs with sky high visions.
But, after the dotcom bubble popped, this reality quickly crumbled away.
All of a sudden, the cheaper workstations from Dell and IBM based on the same tech seemed
a lot more attractive.
So, customers ditched Sun in droves.
And as Sun tried to compete against these lower cost alternatives, their profit margins
would get slashed driving them into unprofitability.
Pretty soon, Sun fell from being the market leader with a $200 billion valuation to being
the drowning giant that needed a bailout.
IBM would offer $7 billion for Sun, but it was Oracle that ended up snatching the company
for $7.4 billion.
Once Oracle took over, the soul of Sun was basically destroyed completely.
Instead of keeping up Sun’s tradition of contributing to and advancing the tech world,
Oracle would focus on milking Sun for maximum profit, but can you really blame them?
Sun had already tried to do the right thing and make technology as accessible as possible.
But, while this strategy worked out fine during good times, as soon as bad times hit, they
were the first to get slaughtered and that’s the story of the company that changed the
world and disappeared.
Were you guys familiar with Sun Microsystems?
Comment that down below.
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