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Why IBM Needs Sun
Written by Gizmo   
Tuesday, 07 April 2009 11:00

From Technology Review:

After weeks of private negotiations, IBM was poised to buy rival Sun Microsystems for a reported $7 billion. Negotiations apparently broke down on Sunday when Sun's board rejected a reduced offer. But beyond allowing IBM to reclaim from Hewlett-Packard the title of world's biggest computer company, why would the company even want Sun, a sprawling Unix vendor that has struggled for years to even show a profit? The answer, according to insiders at both companies, lies in Sun's intellectual property.

Read the full story at Technology Review:

Not only would Sun be IBM's largest acquisition ever, but the buy is out of character for the staid mainframe company, which has for several years worked to streamline itself and become a very profitable vendor of computer and Internet services. But sometimes a deal comes along that's simply too good to pass up. Despite years of losses, Sun has continued to spend an average of $3 billion per year on research and development. Sun also has a huge patent portfolio that might have unique value to IBM, the world's largest and arguably most aggressive licensers of technical IP, according to experts in IP licensing.

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