Submitted by Yi-Wyn Yen01.26.2009
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This prediction is closed and has been judged.
Sun Microsystems chief executive Jonathan Schwartz is on shaky ground. In November, Sun announced massive layoffs of up to 6,000 employees, or 18% of the company. The financial crisis has slammed the server business, especially Sun, which relies heavily on Wall Street spending.
Along with losing market share to competitors IBM and Hewlett-Packard, Sun also embarked on a risky move to promote its free open-source software strategy and sell services to support it. The company bought open-source firm MySQL last year for $1 billion.
Under Schwartz's watch, Sun's stock-market value is worth $2.9 billion, making it less than the company's cash reserves of $3.1 billion as of Sept. 30. In other words, investors believe that aside from its cash, the company is essentially worthless.
Schwartz's approval rating ranks as one of the lowest at 25% on Glassdoor. On the plus side, at least his troops are happier with him than eBay's employees are with John Donahoe.
Prediction: Sun Microsystems announces by April 30, 2009 that Jonathan Schwartz will step down as CEO. For clarification, an announcement that Schwartz will no longer be CEO will be sufficient for a favorable judgment.
Image: Sun Microsystems
Price History
Prediction Statistics
| Betting Closes: | Apr 30 2009 | Current Consensus: | 4.97% | Total Bets: | 51 |
| Today's Change: | 0% | ||||
| Life Time High: | 75.03% | ||||
| Life Time Low: | 4.97% |
Comments
Sun simply refused to modify its Success Formula. Remember when the company launched Java? But leadership (McNeely) would not transition the company to its real source of value - software. Thus it let competitors, including Linux and Microsoft keep closing the price/performance gap. Too bad the company wouldn't use White Space to evolve on the strength of its innovations. Read more at http://www.ThePhoenixPrinciple.com
Apple should buy Sun and get into the enterprise.
@TIS, will an announcement that Mr Schwartz will not be the CEO of the company when an acquisition (e.g. by IBM) is formally announcement be considered to meet the criteria for judgment?
@David, yes that counts.
I am presuming that an announcement to step down will not do. The prediction says will step down by April 30th. So, if he has not left the building, prediction should still be false right?
@Marc, sorry. I should have clarified the date. The date refers to the announcement rather than Schwartz actually leaves by April 30. Will change the the phrasing.
@Yi-Wyn, thanks for the clarification. My guess is that when the acquisition deal is announced (e.g. IBM acquires Sun), announcement on the role that Mr. Schwartz will play will also be announced and it will most likely not be the role of the CEO.
@yi-Wyn Yen, you have changed the bet midway through and cost me a lot of dough fyi. I better not take positions on your predictions going forward as I cannot be sure as to what I am betting on.
@Marc, in Yi-Wyn's defense, the original prediction verbiage had "Sun Microsystems announces by April 30, 2009 that Jonathan Schwartz will step down as CEO". I was merely clarifying if announcement of stepping down as a result of a takeover applies.
@Marc, I was wrong and am sorry that I caused you to lose a lot of money. I wrote the prediction poorly. My original intention was to specify that an announcement is made by April 30, 2009. The original phrasing said: "Sun Microsystems announces that Jonathan Schwartz will step down as CEO by April 30, 2009." That wasn't clear enough since bettors could interpret that two ways. I assume most interpreted it as an announcement made by April 30, '09, but clearly it left room for the latter.
I made it clear now. Going forward I'll be sure to be more careful with the language of the prediction, and if you have any concerns of how to interpret them, feel free to ask before placing a bet. Again, many apologies Marc.
With or without IBM, Schwartz is toast Question is timing.
Details are trickling in ... Chairman McNealy did not accept the reduced bid from Sun while Schwartz wanted it. McNealy won the "battle". Not surprised if Schwartz resigns in the aftermath.
@ron "Apple should buy Sun and get into the enterprise."
funny; when i was at sun 10 years ago Scott McNealy joked that he wished apple would hurry up and go bust so he could buy their great real estate - how times change. Sun: a great innovative company that totally lost its way :-(
Innovation is not what it takes to sell.... & To sell means having something to Sell,
SUN has lots to SELL, lots to donate and Lotsa Great ideas, As always, SUN had,
still has alot of ideas, that it has no clue how to sell...
Money, When the Innovation pipeline is opened up to anyone that undervalues the
meaning of NDA, by that I mean, us the investors... then all competetive advantage
goes with it... Knowledge is POWER, but if all has it then what do we have ??????
I still believe this is the source of SUN's problem, that and the poor recovery from when the
Internet bubble burst, maybe with the touch of a Mix-up in CEO choice.... however it was a
very innovative thing to opensource Solaris, problem was it was a core component
to SUN's product line, then came the T1 open hardware..... then Java.... Storage....
What is left....... trouble is how do you make money and pay for the Developers, and
innovators, if all is given away... Yeah yeah...!! but seriously, how do you ?? Apple did
right !!
All this said, When looking to the future, we have to take chances, make choices,
and act on them... SUN Were too far ahead, and not looking back enough.....
Pity the Marketing ideas caved, and all went out the window, somewhere along the way....
If you look at SUN Now, and 15 years ago, the top heads are mostly the same, times moved
on, ideas changed, and dynamics of the markets were ignored.... New blood was needed, and greed
set in from everywhere, young blood, NEW CEO, nothing to thank SUN for other than how to line the pocket deeper, The young have no shame.... Commitment, and a way out, Sure Sell to IBM for a Miserly SUM, phew, at least I won't be CEO anymore... Sound familiar !!!
What ever, Good Luck to SUN, and all those great Engineers and innovators..
Enough said,
Great technology, poor leadership, lost the entrepreneur spirit and lost all their great sales and technical reps. You cant win in this market w/farmers!
Looks like he is getting a nice package.
http://www.thestandard.com/news/2009/04/20/oracle-buys-sun-schwartz-show...
We are now in a quandry on how to judge this prediction as there has been NO reports on what is the impact to the management. Bloomberg's article alludes to a payout package should Sun be acquired but there has been no details if that package is honored in the Oracle-Sun deal. Schwartz has not made any announcement to step down. Given the merger will have to undergo shareholder approval as well as regulatory approval, this prediction may be judged unfavorably for the lack of relevant news.
@Yi-Wyn, could you provide clarification on your views to David's comments. Thank you.
Hello Mark, I am currently overseeing the prediction market, and am catching up on all of the outstanding questions relating to open predictions, including this one.
Barring regulatory questions or Oracle keeping Sun's current management structure after a merger, it seems quite likely that Schwartz will step down at some point. My take on this is it can still be judged according to the original criteria: Sun makes the announcement that he will be stepping down before the 30th of this month, although the actual date of the change in status may take place after that. If Oracle or Schwartz himself makes the announcement before that date, that still fits the sentence that says "an announcement that Schwartz will no longer be CEO will be sufficient for a favorable judgment."
However, if no announcement is made before this date, the judgment will be against.
Does this seem like a logical approach?
Ian Lamont
Managing Editor
The Industry Standard
@Ian, I fully concur with the approach.
Judged negative. I looked on Sun's website and Google News and didn't see anything about him announcing that he would be stepping down.
Ian Lamont
Managing Editor
The Industry Standard
twitter.com/ilamont
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