MOUNTAIN VIEW, Calif. (09-08-95) - Sun Microsystems Inc. is gearing up to use its new Java technology as a shield for its Unix desktops, as Microsoft Corp.'s Windows 95 steamrolls through large corporations.
Sun Chief Executive Officer Scott McNealy told Computerworld last week that the $5.9 billion firm plans to set up a business unit centered on the Java application development technology. The unit is expected to be formally announced later this fall.
"This is a Unix desktop play because now to run desktop applications, you don't have to run Microsoft," McNealy said.
Java will enable the creation of platform-independent middleware and applications that can be used by Windows, Macintosh and Unix workstations. While the technology is offered on the Internet as freeware for client machines, Web server users must license Java from Sun.
Users and analysts last week said Sun is responding to the fact that Intel Corp. Pentium-based PCs running Windows are slicing into the demand for Sun's Unix workstations in many large corporations. "The desktop of the future is Windows, and Sun seems to have come to grips with it," said Scott Winkler, an analyst at Gartner Group Inc. in Stamford, Conn.
Eric Schmidt, Sun's chief technical officer, said the company will develop Java services and applications and will charge for Java licenses sold to browser firms, server companies and large corporations with Web servers. The Hot Java browser and Java client software are currently free.
"Everyone thinks of Java as an Internet play, but the vast amount of money that will be made on Java technology will be made on networks within corporations," Schmidt explained.
At least one large user -- FedEx Corp. in Memphis -- thinks it can make use of Java applications and middleware to tie together users' Windows desktops and Unix applications running on the firm's Sun servers.
"Java would allow us to be a lot more flexible about what is on the desktop," said Kevin Humphries, vice president of line-haul systems development at FedEx. "Our applications would deal with a Java-like interface, and the desktop would deal with Java middleware."
The Java squeeze play is an important part of Sun's plan to move briskly beyond its traditional role as a workstation provider. Profit margins for its Unix workstations, which account for 70 percent of Sun's revenue, are slipping even though workstation sales are growing 20 percent a year.
Sun is banking on steep growth in high-profit Unix servers to fuel its future. Those servers can support hundreds of Windows PC clients using its SolarNet software.
Sun's server business is growing more than 50 percent a year and accounts for roughly 30 percent of its revenue, including service and support. Overall, the Unix server market is growing more than 40 percent a year, as users re-engineer mainframe systems for client/server networks.
"I'm a lot less worried than I was a year ago because Sun has executed on their plan," Winkler said. "They've continued to grow and put distance between themselves and all the other Unix players, except IBM and HP."
But Sun is also feeling the heat as many other systems vendors line up behind Microsoft's Windows NT at least for departmental servers. In July, Sun announced a marketing push that couples Sun Unix servers with pre- packaged client/server applications, relational databases and beefed-up support for all three types of products.
Since midsummer, the vendor has reorganized its hardware business along product lines so it can modify products more quickly based on commercial IS feedback, Sun executives said. Sun Microsystems Computer Co., Sun's hardware unit, of the recent Windows 95 launch. "It was the marketing coup of the decade. But I think we're going to a lot of shops that have Windows clients and that are buying our servers to get into network computing."
Company executives claim that Sun's strong financials and healthy cash position -- with roughly $1 billion on hand and 26 percent in revenue growth since last July show that its business plan is on the right track.
Yet industry analysts fault Sun for its slow response to technical users' complaints about lagging workstation performance since 1992.
Sun plans to remedy that with new units based on the 64-bit UltraSPARC chip. The new chips will be at least 2 times more powerful than the current crop of 32-bit chips, Sun said.
"Some of their technical customers are clearly nervous that Sun is abandoning them," said Tom Copeland, director of workstation research at International Data Corp. in Framingham, Mass. "Without UltraSPARC, people would definitely look elsewhere."
Many longtime users at large sites said they are waiting to see what Sun will serve up this year and next before they decide to migrate to other systems.
Pete Wagner, information systems director at HCIA, a $50 million health care information provider in Ann Arbor, Mich., gives Sun credit for changing its mind-set from that of workstation supplier to a systems-and- service vendor in the past two years. "At this point," he said, "they're basically there." SIDEBAR: Users Combine Sun Systems with PCs By Jean S. Bozman (Computerworld)
MOUNTAIN VIEW, Calif. (Sept.8) - Some of Sun's best customers are using Windows- based PCs to lower the cost of desktop workstations or gain a unified Windows-based electronic-mail system.
PC-based software tools for computer graphics and for software development are improving. Amoco Petroleum Canada Ltd., for example, combines Windows PC desktops with Sun servers. And Charles Schwab & Co. recently substituted Windows NT desktops for Sun workstations in a major re-engineering project.
"We no longer need Solaris or SunOS for the developers," said Pompi Malik, manager of IS at Brewers Retail Inc. in Mississauga, Ontario. The site uses Compuware Corp.'s Uniface tools to develop Unix applications on Sun workstations, but it plans to move roughly 15 programmers to Windows- based PCs next year.
Gene Kotack, director of information services at Brewers, said the firm will retain three large Sun multiprocessor servers, with 12G bytes of memory on each.
Brewers' situation highlights Sun's worst nightmare for the desktop but also its hope for the future. Even as Windows NT beckons, Kotack said, "I'm not going to go to that platform for my corporate database server until I'm sure it's rock-solid." SIDEBAR: Sun Faces Challenges By Jean S. Bozman (Computerworld)
MOUNTAIN VIEW, Calif. (Sept. 8) - Sun is facing a number of major challenges in 1996, users and analysts agree. Among other things, the company must do the following:
-- Launch a successful fall workstation and server lineup for its new UltraSPARC chip. The 64-bit RISC chip will boast speeds roughly 2 times faster than today's chips and improved onboard graphics.
-- Make its multiplatform strategy work. Today, only a small fraction of all Sun's Solaris Unix operating system sales are on Intel X86 machines, analysts said. Sun said when it ships Solaris 2.5 Unix this fall, the system will be able to run on three platforms: PowerPC, SPARC and Intel machines.
-- Build up the commercial server business to compensate for shrinking profits from workstations.
-- Migrate the bulk of its big user sites to the Solaris 2.x operating system. The new UltraSPARC systems won't run the older SunOS operating system. Sun said it is assisting customer migrations, but only half of its 1 million-plus installed machines currently use Solaris 2.x.
-- Keep up the competitive pressure against Hewlett-Packard Co.'s Unix workstations, commercial Unix servers and services at the high end. On the low end, the battle is pitched against Windows desktops and Windows NT servers. Sun says it offers better price/performance than HP and that distributed computing and the Internet play to its product strengths more readily than to Microsoft's.
[Copyright 1995 Computerworld (US), International Data Group Inc. All rights reserved.]