Sun snaps up Cobalt Networks

Bolstering the low end of its server family and jumping quickly into the hot Internet appliance market were the ideas behind Sun Microsystems' recent purchase of Cobalt Networks for $US2 billion in stock.

With Cobalt's server appliances, customers can go to Sun for everything from server appliances - which are usually less expensive and easier to operate than full-blown workstations - to high-end Unix servers.

Jean Bozman, a research director at IDC, says Sun's purchase of Cobalt will fill a void in Sun's server offerings. Bozman says Cobalt's appliance servers fall into a rapidly growing market for servers that fill specific needs - such as caching - in the enterprise and service provider arenas.

According to IDC, the market for appliance servers will grow from $US740 million in 1999 to $US15 billion in 2004.

Sun isn't the only major server vendor to jump into the appliance server market. Dell Computer announced earlier this year it would offer appliance servers that run Linux, Windows NT and Novell's cache software. Compaq Computer also offers appliance servers branded NeoServers, which run SCO Unix.

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