McNealy out, Schwartz in as Sun chief executive

Legendary Sun Microsystems CEO Scott McNealy is standing down in favour of president Jonathan Schwartz

Schwartz, Sun's "ideas man"

Legendary Sun Microsystems chief executive Scott McNealy is standing down following criticism of his leadership.

At the end of a conference call for analysts last night, McNealy announced the news, saying that president Jonathan Schwartz will take over his role. McNealy will become chairman and occupy a largely ambassadorial role. He said that the reason for leaving his position was that Sun’s strategy was now “crystal clear” and the company was in its best position for some time.

The change was widely rumoured but the timing took many by surprise. Although McNealy described Sun’s latest quarter as “real solid”, the company has been heavily criticised over a perceived failure to take the cost-cutting measures needed to restore profitability.

In a recent article for an academic journal, Schwartz was described as “unproven” by former Sun executive vice-president John Shoemaker. Schwartz, best known for his blog and status as Sun’s ideas man, will now be free to push forward with controversial efforts such as grid computing rental, per-employee software licensing and green computing.

However, on the conference call Schwartz also noted that he would share an office with returning chief financial officer Michael Lehman to ensure that costs were controlled and to oversee “a ton of efficiencies” that need to be implemented.

McNealy’s exit as CEO brings to an end one of the most interesting leaderships Silicon Valley has seen, taking the firm to a number one position in Unix, inventing Java and frequently overturning predictions that Sun would fade under the threat of Intel and Microsoft.