A better fate for Sun. Maybe.

Who needs coffee to start your Monday when you have a huge Silicon Valley merger to open your eyes? A merger of this scale is not usually done in the space of a week, but that’s what appears to have happened.

There are still a whole lot of questions to be answered, of course, but all things considered, this is a far better end for Sun than it was facing with IBM. The general consensus on IBM buying Sun was that the hardware business would be decimated and Sparc was toast. Now it has a chance to live on.

Under an IBM merger, I had heard anywhere from a third to up to half of Sun’s people would be cut. Maybe, just maybe, Scott McNealy thought of them instead of his golden parachute. With less overlap, the Oracle deal could mean a lot fewer people out of work, and that’s good for everyone. California’s unemployment rate is high enough.

Of course, things could all go in the opposite direction. Oracle Co-President Safra Catz did make it clear on the conference call discussing the merger that the hardware business would have to be profitable, and Sun is legendary for its R&D spending. Will Rock ever see the light of day? I’m still not sure after this.

It’s funny how despite all the copy I’ve seen written about this merger, it was the Farkers who pointed out the obvious: Oracle now gets to be IBM. (That’s why I love you guys. The jokes written in SQL code were a nice touch, too.)

IBM, now minus the PC business, is essentially a software and services company built around hardware. In its most recent quarter, hardware only accounted for 10 percent of sales, but all the software and services that CEO Sam Palmisano has built the company around are based on that hardware.

Now Larry Ellison has exactly that. He will have some impressive hardware that has been given the short shrift lately, hardware that bares a very strong resemblance to what Cisco is trying to do. As it is, the majority of Sun servers are likely running Oracle software now, notes Charles King of Pund-IT research.

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