Sun woos Wall Street with pricing, features

Before what appeared to be a receptive audience, Sun Microsystems on Tuesday fired off a barrage of product promotions, upgrades and service announcements in an attempt to retake its traditional stronghold in the financial community in New York.

Making the case that the company's Solaris operating system offers better computing performance and system management for less money than comparable Linux systems, company President Jonathan Schwartz told a banquet hall full of investment banking analysts and financial services executives that it delivered what its customers on Wall Street said they wanted.

Schwartz acknowledged that Sun initially was not prepared to deliver products that customers were asking for during the economic downturn of the early part of the decade.

"You gave us a shopping list," Schwartz said. "We didn't have much to deliver."

Customers were asking for versions of Solaris that ran on multiple platforms and higher levels of performance for lower prices, he said.

"Now, our shelves are full," Schwartz said.

The big questions for Sun, according to users and analysts here, is whether they can differentiate their technology from Linux. In the last several years, Schwartz pointed out, Sun delivered Solaris on x86 technology, but also has certified a wide variety of software to run on its Sparc processor systems.

"One of the main items on the shopping list was, you wanted choice," Schwartz said.

In an effort to take back customers it lost to Linux, Schwartz announced a 50 percent discount on Solaris right-to-use licenses for customers upgrading from Linux.

"There's no question that Sun was tremendously successful in the financial community when it was less price sensitive, but they then lost ground to Linux," said Gordon Haff, an analyst at Illuminata, who attended the New York event.

For financial industry users, pricing is not the whole story, however.

"We have to look at the whole value proposition, though of course price itself is important," said Steve Rubinow, the chief technology officer for Chicago-based Archipelago Holdings, an electronic trading system.

"We're not as big as some of the companies here, so we may have tens of servers, not hundreds, so the dollars don't add up as fast," Rubinow said. "If I can manage an environment of (just) Sun servers and avoid support headaches, running Sun offers an advantage."

Sun is competing with Linux, at least for the time being, on features as well as price, other users agreed, and Sun pricing has put it at least in the same range as Linux systems.

"We're spending money on Linux because we have to buy Linux systems too, and that's because we have to buy service, we're not just getting the operating system for free," said an IT executive at a major investment bank that runs both Sun and Linux systems. "Right now we like the features that Solaris offers, for example the resource management capabilities are better than Linux's," said the executive, who declined to be named.

Sun promotions geared to financial companies in New York included a Xeon trade-in program offering cash credit for customers switching from Intel Xeon servers to Sun Fire systems based on Opteron processors. The credits range from US$560 for low-end Sun Fire V20z servers, to US$1,250 for midrange Sun Fire V40z servers and US$860 on Sun Java Workstations.

Sun also is offering a free trial of a Sun Fire V20z server and Solaris 10 to selected customers.

In addition, Sun released pricing information for products announced earlier but shipping Tuesday. These include the Sun Fire V490 and Sun Fire V890 servers, at starting prices of US$30,995 and US$39,995, respectively.

Building up to the launch of Solaris 10 next month, Sun also announced Tuesday that new products, migration tools and support will become available over the next 90 days through its Software Express for Solaris system adoption program. These include Predictive Self Healing, the Dynamic Tracing resource management feature, the new file system ZFS and Project Janus, which offers Linux/Solaris interoperability.

Archipelago's Rubinow said that his company had been eying Linux systems, but that the new Sun technology, including Solaris 10, was a major factor in keeping the electronic exchange in the Sun camp.

Details of many of the products announced Tuesday, however, had already been made available, noted industry insiders at the event.

"This wasn't just a product announcement," Illuminata's Haff said. "They are coming back showing they have completely changed the company's strategy, and they seemed to have a receptive audience, but only time will tell. This is a test case for the future. They need to succeed here on Wall Street."

Ultimately, Sun will pass the test only when users vote with their wallets, he said.

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