By eweek  |  Posted 2004-08-23 Print this article Print

-designed components"> Its the combination of Solaris and Opteron that enable this? There are two aspects to this. Obviously we dont have to pay margins to someone else like [Linux vendor] Red Hat or [Microsoft Corp. for] Windows, so that we can just choose to combine the pricing and offer the lower price. From a service standpoint, since we create both the hardware and the software, we can very efficiently provide service to customers. If they have a problem, they call us up. Its all stuff we know. We dont have to have a complicated system for resolving problems, and therefore we can do it at a lower cost. From a business standpoint for us, its pretty simple—we can offer a lower cost to customers and we can still make money.
Right now this first generation of Sun Opteron systems are built with best-of-breed components. Youve said that over time, Sun will start putting more of its own technology into the systems. Can you elaborate on that?
What were concentrating on are elements of our own design where that adds value to the systems. So youll see new designs coming from Sun that employ different mechanical, thermal and power [features] that are of our own design [and] bring our own enterprise experience to bear, as well as support for support processor and BIOS, which again is where we bring our own experience to bear. In the microprocessor itself and some other aspects of the system, its completely leveraged from companies like AMD, and we use today in our systems … Nvidia, and we use LSI Logic as other examples of companies that were partnering with. What youll see in systems going forward in the future is more and more components that we include our own design efforts on. It isnt willy-nilly—its only where we see we can actually add some value. In the last [fiscal] quarter, Sun reported that shipments of x86 systems were up 115 percent [from the previous quarter]. Still, that was fairly insignificant to Suns bottom line. When do you anticipate Opteron making an impact on Suns financial picture? We never give forward-looking comments about finances and all that, so Im going to stay away from what I think is material or not. But my plan is actually pretty simple, and the last quarter, which was our fourth quarter, was a good start on that. Im going to build up the product line, as we did with the four-way, and then going forward during the course of the year with additional products, and then were going to be continually working on different business offers as well as channel programs and sales programs to reach customers so that I can be growing regularly on a sequential-quarter basis. The market itself is very big—the x86 server market is around $20 billion—so I can actually have a significant impact on Sun by only taking a small percentage of that because we are growing from a smaller place. My intent is to just grow regularly on a quarter-by-quarter basis. Do you see that growth coming from within Suns installed base or from stealing market share from competitors? Since Sun is in practically every Fortune 100 company [and] in a broad range of industries, it would be difficult to go to a customer that doesnt already have Sun. But [what] weve seen so far is that weve been able to go back and actually participate in business that we couldnt have participated in before. If the customer has already chosen x86, whether its for low-end price performance or because they want to run Linux or for whatever reason, the short list used to be Dell, HP and IBM, in whatever order [the customers] want, and we can now compete for that business. So far that has been entirely additive. Next page: High-performance computing.


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