Consumer privacy issues are a "red herring," McNealy told a group of reporters that year. "You have zero privacy anyway. Get over it."
The statement seemed shocking all those years ago, but its pertinence has only increased over time. Privacy is the hot-button issue in this era of social profiling and mass surveillance, and concern among consumers is growing -- with good reason.
McNealy went on to found a startup, social intelligence and visualization company Wayin. But he hasn't stopped worrying about privacy. Today, he considers governments the biggest threat on the horizon.
"It doesn't really bother me that Google and AT&T have information about me, because I can always switch to another provider," McNealy said in an interview last week. "If Uber starts screwing around with my data, I'll use Lyft."
It's a different story when it comes to government.
"There's only one DMV," he said. "What scares the daylights out of me is the idea of a planned socialist economy driven by a bureaucratic government of appointed officials."
When government is small, the threats it poses are relatively few, said McNealy, who has called himself a "raging libertarian."
It's a problem, however, when it grows and gets involved in areas like healthcare, education and insurance: "When they are telling me what size Coke I want to buy and dictating food portions in schools, it's becoming a nanny state," he said.
Rather than working to protect citizens' liberties, large governments take away their freedom along with their assets and money, McNealy said.
"It scares me to death when the NSA or the IRS know things about my personal life and how I vote," McNealy said. "Every American ought to be very afraid of big government."