There are reports that the talks related to IBM purchasing Sun have fallen apart. The New York Times reports IBM Withdraws $7 Billion Offer for Sun and the Wall Street Journal (which originally broke this story) reports IBM Talks Teeter as Sun Board Splits.
In the short term, my selfish side is pleased with this because I really enjoy using NetBeans and GlassFish and enjoy having other Sun-provided alternatives available even when I don't use them often because I am a strong believer that competition does drive better and cheaper product offerings. As I blogged on previously, I had serious doubts about the future of many of these products with IBM having more control over their future.
In the long term, however, IBM's acquiring of Sun may have been better for the general Java development world than some of the other alternatives that are now possible. IBM has committed significance resources to developing tools and resources related to Java development as evidenced by Eclipse, by WebSphere, and by developerWorks articles on Java.
It is often the case that we will never know what would have actually happened had history taken certain different turns. So the best we can do is to speculate based on past actions what might have happened. Similarly, it is difficult at this point to know if the apparent current stall in talks between IBM and Sun is beneficial or harmful to the long-term prospects of Java.
Of course, rumors of Sun being purchased by EMC, Fujitsu, HP (don't take this link too seriously!), Cisco, IBM, and Oracle have been circulated before and it is still possible that such a purchase may occur in the near future. In fact, now we are seeing rumors of even more complicated deals like Oracle and HP buying Sun and taking the pieces each wants.
No matter what happens, JavaOne will likely be dominated by talk related to any potential acquisition of Sun (or any acquisition in progress if that is the case). In fact, any uncertainty will likely weigh over the Java development community at many events for the next several months until/unless something more definitive actually happens.