LAS VEGAS (CNN/Money) -
Scott McNealy, CEO of Sun Microsystems, hears all the naysayers loud and clear. And even though his company's stock price is less than $4, he maintains that the Sun is not setting just yet.
"At least people are still writing about us. Things are not all that bad," he said.
Scott McNealy, CEO of Sun Microsystems, said the tech landscape isn’t that bad and Sun’s doing fine too. (Photo: CNN/Money)
McNealy, speaking at Comdex on Monday, noted that Sun (SUNW: Research, Estimates) has an ample cash load and that will help the company during the downturn. But he conceded that the biggest challenge for Sun is "What's next?"
After years of dominance in the workstation and server markets, investors are wondering if Sun can adapt quickly enough to survive in a world where there is less of a reliance on big machines. Small is the new big now, it seems.
In fact, at a media briefing on Sunday, Bear Stearns analyst Andrew Neff said that the strategy Sun has chosen as of late is one of "denial."
To combat this perception, McNealy spent much of his keynote speech discussing new initiatives that will allow networked computing to be mobile. McNealy said that the company intends to spend more than $10 billion on research and development and acquisitions over the next five years, despite some backlash from critics. "We're getting drilled for spending on R&D," he said. "Our attitude is: How can you not invest in R&D?"
McNealy demonstrated one outgrowth of this R&D spending -- a smart card that runs on Sun's Java technology. The card will include all the network settings of that particular user. So for example, if you needed to go from your office in New York to one in Los Angeles, all you would need to do to access your computer's hard drive would be to plug the card into a workstation.
McNealy says that in the future, people could use such cards at home in order to easily plug into their workplace's network via DSL or cable modem. He adds that having devices in hotels would make it easy for business travelers to access their network without having to lug around laptops. "People want mobility. It's staggering how mobile we've become," he said.
Rarely a kind word for competitors
McNealy, known for making caustic remarks about competitors, didn't disappoint. In a whimsical top ten list of how you can tell that things are bad for tech, he joked that Oracle (ORCL: Research, Estimates) CEO Larry Ellison has taken a second job as guest host of "The Bachelor" and that many tech CEOs are now auditioning for roles in "Jackass The Movie Part 2."
But in a somewhat surprising development, he actually had some good words to say about his biggest arch rival, Microsoft (MSFT: Research, Estimates). He gave the company credit for spending heavily on research and development in order to try and create a networked computing solution that is less complex.
Of course, he was quick to point out that the problem with Microsoft is that there is little flexibility within its operating system. "There's no mix and match. Their strategy is buy one, buy all," McNealy said.
His more pointed barbs were saved for IBM (IBM: Research, Estimates), Dell (DELL: Research, Estimates) and Hewlett-Packard (HPQ: Research, Estimates). He said that IBM's new global services strategy means that IBM is more of a consulting company looking to hawk its own wares and less of a pure technology company that solves problems with research and development. "When IBM says they'll give you best of breed, what they mean is in-bred components," McNealy said.
McNealy described Dell as a company for people who like to buy 10-speed bikes unassembled. Finally he said that HP is not a viable option for many corporate customers, joking that, "I just don't think that printing is the core of most of your problems."
It's good to see that McNealy still has a sense of humor considering that his stock price is down nearly 70 percent year to date.