Sun pushes price cuts to stay competitive

Sun Microsystems Australia has kicked off its first quarterly product release with 40 percent price reductions and the first example of its much-hyped N1 strategy, in an attempt to stay competitive in a depressed spending market.

Sun executives told ZDNet Australia   they had decided to combine product launches across their range into a single quarterly product launch, which also encompasses relevant N1 support software and services.

"The benefit for Sun in bringing all these products together in a launch is...it enables us to a take a systems and solutions view of what we're taking to the market," Alec Cameron, national manager for product management at Sun Microsystems Australia told ZDNet Australia  .

Sun Microsystems Australia has cut prices across its midrange and high-end Sun Fire 1050 MHz servers by up to 40 per cent, citing a combination of operational efficiencies achieved in the last 18 months and a strong Australian dollar. The newly released 1200 MHz systems sell for 25 percent more than the 1050 MHz, but Sun are quick to point out the benchmark pricing for their high-end servers is less this week than it was last week.

"There's a price reduction across all our products due to the exchange rate but it's relatively modest," said Cameron. "We believe in terms of list prices on a like for like basis this puts us slightly under our competitors of course, list prices don't always equate to street prices."

For Sun, the big news is the first release of a product with N1, which groups widely distributed computing resources for centralised management, which Sun claims automates many processes and allows administrators to manage 20 times the number of servers they can normally.

"We're going to really show the world why we're an intellectual property shop, why we invest in our own research and development," said Neil Knox, Sun's executive vice president of systems that ship in high volume and the general on the front lines of the battle to keep Sun ahead of servers that use Intel processors.

But the company's boasts about the power of its own intellectual property are tarnished by the encroachment of Linux and Intel into Sun's product line. That outside technology competes directly with Sun's UltraSparc processor family and Solaris version of the Unix operating system.

Sun has been grappling with change since it lost much of the cachet it had during the spending frenzy of the dot-com years. The company is working hard to return to sustained profitability after several quarters of losses triggered by curtailed spending and fierce server competition with IBM, Hewlett-Packard and Dell Computer.

"McNealy and crew are just a little bit crazed, but with that fanaticism and that attitude, they have a nimbleness they've demonstrated on a multiple occasions--people tend to forget that," said Illuminata analyst Jonathan Eunice. Sun made the leap from workstations to servers in the 1980s. It came up with Java when Unix was threatened. It successfully pushed high-end and low-end Unix servers when competitors thought it would be a mistake. "I've been hearing Sun's strategy is now bankrupt and will be outstripped by X or Y since the 1980s," Eunice said.

There are clear signs of Sun's adjustment to the arrival of cheaper computing components. Executives cite the willingness to let archrival Intel and once-disparaged Linux into the fold as an example of Sun's adaptability.

"We talk a lot to our customers. We're focused on meeting their needs rather than our religious commitment to a certain architecture," Sun's Knox said. "Intel has changed the clock speed to the point where it's a viable computing platform for certain applications."

Sun is also beginning to catch up to HP and IBM in one important new server area, blade servers. These smaller systems fit side-by-side in a single enclosure, reducing cabling snarls, sharing components such as power supplies and providing a showcase for management software needed to control the machines.

RLX Technology pioneered the concept. HP's first blades--actually those from Compaq Computer before the two companies merged--were released a year ago.

As 2002 progressed, most blade advocates started propounding higher-end models with two or four processors, a concept that start-up Egenera led. That direction is where the blade products from Dell and IBM headed as they arrived late in 2002. Sun's blades have some differences. For one thing, there will be UltraSparc blades, the AU$3,650 B100 due in the second quarter, while competitors are focusing on Intel blades only. And sliding into the same AU$8,550 B1600 chassis will be blades using Intel-compatible processors, and specialty "content load balancing" and "SSL Proxy" blades due later this year.

The biggest difference will be the N1 management technology. This technology, a Sun idea bolstered by the acquisitions last year of Terraspring and Pirus Networks, ultimately will collect groups of servers, storage systems and networking components so they behave more or less like a single mammoth computer. The goal is to reduce the number of administrators it takes to run complex computing operations.

N1 competes with IBM's management plans, variously called eLiza, autonomic computing, utility computing and on-demand computing, and with HP's Utility Data Center product and adaptive infrastructure initiative. Sun, though, has done a good job bringing its vision toward reality.

"I was very impressed. In a period of six months, Sun was able to go from no N1 story to a very sophisticated N1 story," Eunice said.

Advertisement

Talkback 0 comments

Latest Videos

Sponsored content

Power Centre - Content from our premier sponsors

Blogs

  • Phil Dobbie A guide to the future of the internet
    Last week we looked at the history of the internet in Australia. It's been around for 20 years and changed our lives in so many ways. Imagine what it could do given another 20 years.
  • Array Carelessness busts Linux security
    No operating system can ever properly protect a computer from trojans as long as users continue to do silly things. Just because Linux is immune to your standard drive-by viruses it does not mean that it can escape trojan horses.
  • Array Sun shining on Ajnaware
    Graham Dawson talks about the future of iPhone app development and augmented reality.
  • More blogs »

Tags

Back to top

Featured