From an enterprise perspective, here are the core issues with Sun...
1) A failure to execute. They were increasingly unable to compete in the high-end UNIX server market against IBM. The Rock processor was constantly delayed. Their machines fell behind in performance, Solaris was harder to manage and less stable than AIX.
2) Inability to capitalize on their inventions. IBM used Java as a common language across all of their enterprise platforms, they sold Websphere as a common application platform. NetApp was able to build a large business off NFS.
3) Linux/Intel got a lot better on the low end, Sun could not give a good reason why their platform was worth the additional cost. Usually when you are disrupted on the low end, you move upmarket, but due to 1) they were unable to take this path.
4) Muddled strategy: they dabbled in a lot of things-storage, office suites, mysql, etc. It was hard to tell if they loved or hated open source at times. They spent years battling Microsoft in the press. They had 2-3 different virtualization technologies. Some of the best Fake Steve Jobs posts are when he ripped into Sun.
5) Even if they were able to execute, their niche was becoming less viable. A mid-tier hardware manufacturer using a proprietary operating system is not a good position to be in. They did not have the deep enterprise roots and consulting business that IBM has, nor a massive install base like Linux or Windows.