IBM Totally Disses Sun: Report

Despite repeated attempts by Sun's management to put its house in order, the company's stock has been in retreat for months, and its revenue tumbled 11% year over year in its recent second-quarter results.

If IBM does walk away from the Sun acquisition, it is unclear which other companies, if any, would step in to purchase Sun. Speaking in Seoul, South Korea on Wednesday, Cisco(CSCO) CEO John Chambers told journalists that his networking firm was unlikely to make a move for Sun, despite its own recent entry into the server market.

In a recent survey of resellers, analyst firm R.W. Baird found that Sun was cited as a better strategic fit for Dell(DELL), as opposed to IBM. "[This] may be true, though we would not want to see Dell attempt to digest a large, complicated entity," wrote Jayson Noland, an analyst at R.W. Baird, in a note released Thursday.

Last month Intel(INTC) CEO Paul Otellini said that Sun will eventually spin into IBM's orbit, but added that he is still weighing the possible impact on his own firm.

>To order reprints of this article, click here: Reprints