One of things that is important to note is that even though we are engineering out of one group, we are continuing to sell things in several different ways because there are many core customers, for example, that purchase storage through a separate department in their organization, and there are many other companies that dont do it that way. They purchase infrastructure as a single solution, so obviously well be able to cater to those areas both strategically and technically. In terms of strategy, [CEO Jonathan Schwartz] is a big believer in gestating products and technology because often times there is a separate group and then the company combines them later. If you look at Suns history, we did Java as a separate group and then combined it with software. The x64 [x86, 64-bit] systems were a separate group and then we combined that together in a single organization.In terms of technology, there are a number of trends where software and hardware technologies are combining a lot more disks on servers. We have our own examples of that on Thumper and what we announced with the [Intel-based Sun Fire x4150] and the other related Intel products, which have a lot more incorporated on them and a lot more disk capabilities. Is it a server system or a storage system? It is kind of ambiguous. In the networking arena, between Fibre Channel switching, SAS, 10 Gigabit Ethernet and InfiniBand, there are a lot of activities going on between how people connect storage and servers, so one of things thats exciting about putting it all in a group is that all the people that are working on incorporating disks into servers, as well as people working on the switching between storage and server, as well as all the people working on high-end storage systems, are all now in one group. Will Suns channel strategy change after the server and storage division are combined? On the sales side, we are not going to be making any changes. We have a set of direct practice specialists that have experience with storage and they will remain the same under the same people. We also have people who specialize in the channel and that will remain the same. Fundamentally, what we have are channel partners that are selling both storage and systems products already and this is no difference [for] them. Then there are channel partners who are only selling storage products, and we absolutely will continue to cater to those channel partners because they are a core part of our business. One of the questions I get is if Sun is only going to focus its selling storage on its own systems and that is absolutely not the case. A significant percentage of our revenue is selling archived and storage on other systems, including on IBM mainframes, and that is an essential part of the storage business model. How is the new agreement with Microsoft going to change Suns approach to the market and its customers? If you looked at Suns system business about three to four years ago, it was pretty easy to describe. It was Solaris running on SPARC and Solaris itself was not an open-source operating system, so it was kind of the classical way you did systems. A few years ago, we did a pretty big sea change and that sea change goes in three parts, which are very important to understand. The first was to take Solaris off of SPARC and then open it up by putting it on an x64 platform, so that people could pick Solaris without picking [Sun] hardware. Then we open-sourced it, so people would build a community around Solaris, whether it is developers or other businesses, and thats a very big part of opening up Sun. The second part of the change, and Niagara 2 was part of this, is that we took our own designs and moved much more aggressively than anyone else around the multicore, multithread and virtualization technology, and that has sparked a resurgence and interest in our own hardware. We also open-sourced the Niagara processor, so we are extending it to hardware as well. Page 3: Sun Looks to Strengthen Systems Under One Command
When we acquired StorageTek, we kept StorageTek and the storage organization separate organizations and then ultimately combined it later. So, its a natural life cycle of the fact that you can get some great opportunities to innovate by being separate and then you also get some great opportunities to innovate by being together and this is just part of that natural life cycle.