Should McNealy step down?

In terms of what the vision has been, and what it needs to be, Natis believes that Sun is paying an insufficient amount of attention to partnerships. "In modern industry, it's very difficult for a single standing vendor to compete," said Natis. "Microsoft and IBM know this and now partner in various capacities. Sun, on the other hand, has abandoned its partnership with BEA and that will prove to be a great loss. On the J2EE front where partnership with licensees is equally important, Sun is seen as dominating, not accommodating. They're just not seen as a great partner. So, there has to be a new vision and a new direction. One shortcut to this could be to put a new man in charge. But, without a new vision or strategy, that could be worse than what you have now. Ultimately, change is required and unless he is able to change, then maybe McNealy should go. So, if you're asking me if that option should be considered, the answer is yes."

What's my personal take on the situation? I like McNealy, especially his tenacity and accessibility. He reminds me of the time I worked on the set of Miami Vice when, during breaks, Don Johnson would run off to hide in his trailer while his co-star Philip Michael Thomas would walk up to you and introduce himself and shake your hand. He's like the baseball player that stays until the last ball is autographed.

Implicit in his message is the notion that Sun is not greedy or monopolistic, although you have to wonder if McNealy had Microsoft's market position, how magnanimous he would be toward competitors. R&D is the key to Sun getting out of its tailspin.

McNealy is thoroughly convinced that if you give him a few minutes of your time, you will see the light. Deep inside, he believes that he is on the side of righteousness and it's the courage of those convictions that keep him from changing his business card. From his point of view, the hell he's going through is far worse than the hell that business leaders will go through if they don't wake up and smell the coffee. He's not in it for growing his substantive personal fortune, he's in it for the crusade.

Unfortunately, nice guys, white knights in shining armour and crusaders sometimes finish last. Although Sun is far from last, it's in a pinch and it has been in one for 10 consecutive quarters. During that time, his competitors, most of which never fell out of profitability, sank their teeth deeper into the niches that are Sun's traditional sweet spots. To make matters worse, Standard & Poor's just announced that it has put Sun on a credit watch.

In his open letter to McNealy, Milunovich wrote "Scott's brash and contrarian personality have been synonymous with the company's image and success. Unfortunately, the act is getting old." Milunovich's observation is actually two years and $2bn short (give or take). I said the same thing two years ago in a story about how McNealy's rhetoric isn't resonating. In my interview with McNealy, he cried foul, saying he gets baited. But the rhetoric has never really stopped. If he continues to fight his war for market share with his sarcasm and castigation of competitors, it's worth asking if he can retain control of the company.

McNealy has done all he can for the ailing Sun. He's earned his stripes as an industry pioneer and he's also earned a nice, long and relaxing vacation. It could be that he has the right vision to move the company forward, but can't get rid of the "beleaguered" label tattooed to his forehead. Now, while Sun is still in the game and cash rich, would be a good time for McNealy to consider taking that vacation.