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Q&A: SCOTT MCNEALY We're all about products that have the shelf life of a banana, so we have to focus on R&D Scott McNealy co-founded Sun Microsystems Inc. in 1982, and was its chairman and chief executive officer from 1984 until he handed over the CEO job to Jonathan Schwartz in April this year. The company's servers and workstations helped drive the business-computing and Internet revolutions; among its better-known products are the Network File System (NFS), the Solaris operating system and the “write once, run anywhere” Java computing platform tq What technologies are you watching right now?

Scott McNealy It's interesting to see what's happening with wireless and getting video down the wireless [connection]. I think voice over Internet protocol is an untapped market opportunity. And I think software as a service is finally gaining steam. As well, I think you're going to see computers [or infrastructure] as a service. I think that's going to be a new [trend]. It's not a technology innovation, it's just an anthropology innovation. I don't have to make my own truck, I don't have to buy my own truck...so it's the FedEx model [of hiring someone to provide the trucking service for you]. I think that's probably going to be the biggest driver, or wave, we're going to surf going forward.

tq How will computers as a service help the businesses that use these technologies?

SM It's especially [important] in Canada, where you don't have as many large organizations. Morgan Stanley, J.P. Morgan, Citibank — they can afford to hire rocket scientists and go create custom grids. Most of the small- to medium-sized enterprises in Canada don't have the technical resources or the financial resources, nor do they have the workloads to justify the economies of scale of building a large-scale, high-performance computer grid, or storage grid, or display grid. So by sharing public grids you can get access to the best without having to invent the best.

tq You've been running Sun for a long time. What do you think is the most important thing you've learned about running a business?

SM I think you can never break character, and you've got to maintain absolute integrity throughout. I'm very proud of the 24-year track record of Sun. I don't know anybody who wouldn't give us the highest of marks for integrity and character and transparency and honesty over those years.

tq What's your impression of Canadian businesses — are they competitive?

SM There's always an advantage that the U.S. has in terms of having a larger market, and there are very few export laws between California and Nevada and between Nevada and Wyoming and all the rest of it, so you've got a large available market.

tq What should individual businesses do to improve their competitiveness?

SM Well, these all sound self-serving, but as the chairman [and CEO] of the company for the last 22 years, if what Sun was doing isn't what I would tell you to do, then why [was I doing it?] We're moving to mobile work environments and work-from-home, and we've gone browser-based in all the services that we offer, like Google. Do you need a PC to access Google? No, you need a browser. So we think browser-based infrastructure will move into the utility computer model. We are looking at our make-buy decisions everywhere. There are some things that are very important that we make and we focus on those, and there's lots of stuff that we ought to be buying, and we buy those. I think too many companies have made the make decision on too many things, so they're good at very few of them.

tq You also put a good deal of emphasis on R&D. That's important?

SM Especially important in our industry. I'm not sure it matters so much at Coca-Cola. You know they invented New Coke, and the world kind of rejected it and they went back. I can't launch a new computer and have the world reject it and bring out old SPARCstation. IBM can cut back on R&D because they're a people-intensive company. They're all about services. We're all about products that fire up in your data centre, and they have the shelf life of a banana, so we have to focus on R&D.

tq So it does depend heavily on the industry you're in?

SM Right. So, I wouldn't recommend that Coca-Cola start doing $5-billion worth of cola R&D, and we don't spend the kind of money on advertising and marketing that they do, because all the marketing in the world isn't going to make these [IT] guys buy our computer. They're going to run the benchmarks, they're going to look under the hood, they're going to evaluate and test their code on it. A Super Bowl ad isn't going to win them over.