Sun Case
Week 6 assignment Liwei Geng
1. What is competition like in the computer server industry? Which forces are the strongest? Which are the weakest?
Low-cost servers based on Linux or Windows operating system continue to grow faster than their Unix counterparts, a trend that has been evident for several quarters. Linux server shipments grew 61.6%, while revenue from Linux servers grew 54.6% last year. Dell, HP, IBM, Sun Microsystems and Fujitsu Siemens are as the worldwide server market leaders.
Current Competitors: main competitors are HP, Dell, IBM, SUN and Fujitsu.
Potential Entrants: None. The capital expenditures required to develop and manufacture microprocessors and chipsets is enormous—an insurmountable entry barrier for almost any company that would like to join the fray. Companies wishing to enter this industry need only to look at one of Intel's multi-billion-dollar chip fabrication plants before s/he will undoubtedly find some other industry to invade.
Buyers: Buyers include end-user home computer builders. But large computer manufacturers such as Dell, Gateway, and Hewlett-Packard account for the vast majority of chipset and microprocessor purchases. Buyer power in this industry has fluctuated from time to time, but for the most part, the "Intel Inside" logo has been considered by most manufacturers to be too important to forgo.
Suppliers: it is safe. Raw materials—silicon, semiconductors can be purchased from a lot of manufacturers, thus affording the firm a great deal of buyer power in selecting with whom to do business.
Potential Substitutes: These companies only compete in a limited number of arenas. The most powerful Windows/Intel server is far less powerful than most Sun Microsystems machines, but they are also far less expensive.
2. What is Sun Microsystems’ business model? What impresses you most about the company?
The Network is The...
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