Sun does dancing bear act for Wall Street
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Sun Microsystems went to Wall Street today, hoping to convince prized financial services customers that it still matters, has speedy kit on the way and offers unique pricing.
The story of Sun's one-time Wall Street glory days is pretty well over-played at this point. The firms flocked to Sun's UltraSPARC-based servers, and pushed Sun to server kingpin status. In the last couple of years, however, the financial companies have spent much less money on hardware, and when they were buying, they increasingly spent cash on Linux boxes from the likes of IBM and Dell.
That's why Sun's President Jonathan Schwartz kicked off an event today in front of the Wall Street crowd. Schwartz's key message was that Sun has broadened its product portfolio to include Opteron-based servers, made Solaris faster, stronger and more cost-effective than Linux and developed a utility computing pricing model financial services companies can embrace.
"You guys said, 'Would you stop being an island. Your rhetoric is of a company that views itself as an island,'" Schwartz said.
The main way in which Sun has stopped being as island comes from its increased attack on the x86 server market. Schwartz didn't bring up anything terribly new on this front, but did remind customers that Sun has Opteron-based workstations and servers and will be rolling out more kit over the next year. These systems currently run Linux and a 32-bit version of Solaris and will run 64-bit Solaris 10 by year's end.
Sun pointed to the Tokyo Stock Exchange, The Philadelphia Stock Exchange, Visa, Reuters, Archipelago and SunGard as financially-minded customers who have either already picked up the Opteron-based gear or plan to. A number of these customers did so with the intention of running Solaris x86 instead of Linux. Sun insists that Solaris 10 will outperform Linux on standard x86 gear and fly even faster on Sun's specialized Opteron gear.
To up interest in its new servers, Sun also kicked off a couple of promotions. Sun will offer Wall Street customers willing to trade in their Xeon servers up to $560 to shift to the two-processor V20z, $1,250 to move to the four-Opteron 40z and $860 to pick up a Sun workstation. Sun is also offering a 50 percent discount on Solaris for those customers that will shift off of Linux.
All of this Opteron attention is a clear attempt by Sun to win back some of the business it lost, namely to IBM. Big Blue has punished Sun over the past two years, gaining large amounts of Unix and Linux market share. HP and Dell have also enjoyed success in the Linux market, while Sun slowly worked out its strategy.
One area where Sun has enjoyed a jump on the competition is in software pricing. In a bid to boost its failing software business, Sun rolled out the JES (Java Enterprise System) model of selling infrastructure software for $100 per employee per year to large companies. So far, Sun has picked up about 400,000 employees for JES. It's no DB2 or WebSphere business, but it's not bad.
Now, Sun plans to sell companies raw processing power at the rate of $1 per CPU per hour. Basically, customers that currently need massive amounts of CPUs to run large software workloads can send their jobs over to Sun for processing instead of building their own specially cooled, expensive data centers to handle the tasks.
"Here is our infrastructure," Schwartz said. "If you map to it, you're welcome to use it. If you spend more than a buck per hour (on software jobs), then we're cheaper."
Along with these promotions and new pricing models, Sun also updated several products.
Sun highlighted the StorEdge 6920, 9990 and 5210 NAS storage systems. It also announced that the Sun Fire V490 and V890 servers have been upgraded with the latest UltraSPARC IV processor and touted the release of the SAM-FS Version 4.2 file system.
Overall, Schwartz's delivery was less hype-filled than usual, largely because Sun these days has actual product to dangle in front of the financial services crowd. It's no longer lugging around the shameful Pentium III-based LX50 box, bragging about how it will give Dell a run for its money. Sun and HP are the clear Opteron leaders these days, and that's something that has at least Intel, and likely IBM and Dell, concerned.
As Schwartz emphasized, Sun has returned to its roots by cobbling together commodity parts to form screaming fast servers.
Does this mean Sun's problems are solved? Hardly.
While Schwartz was wooing Wall Street, CEO Scott McNealy was busy chatting with the plebs and summed up the situation pretty well when asked what Sun's biggest challenges would be moving forward.
"Image, reputation, getting the story out. So many folks love what we are doing but worry if we will be around and relevant," McNealy or a robot pretending to be McNealy wrote during the chat session.
"We will be." ®