Sun warms to Intel and Linux.

Scott McNealy is well known for sticking to his guns. For years, the CEO of Sun Microsystems has broadcast that - no matter what direction the server market took - the company would always remain loyal to the Solaris operating system and Sparc processing architecture that it has spent years tuning and developing.

But in August 2002, McNealy announced a dramatic about-face in this strategy. At the LinuxWorld conference in San Francisco, Sun debuted the Sun LX50, an Intel-based server capable of running either Solaris, or Sun's version of the open source operating system, Linux.

The announcement comes as an admission by Sun that many of its larger customers are now looking to Linux for their low-end requirements, while many thousands of small- to medium-sized businesses simply want lower cost of ownership.

Solaris, Sun's high-end Unix operating system, is seen as too big and unwieldy for non-intensive applications such as file sharing or email, while Sparc, the company's high-end processor, does not have the price-performance ratio of Intel's Pentium processor or AMD's Athlon chip. Clearly, Sun has realised that, for all its previous posturing against Intel, Windows and Linux, it cannot meet enterprises' requirements across the board until it can address these right across the computing spectrum.

"We have to face reality. We could never have a marketing budget big enough to convince people in small and medium-sized businesses that Sparc and Solaris are right for them," confesses Michael Avis, UK product sales director at Sun. "All the people coming out of university are using Linux - they aren't using Solaris. If we want to take advantage of those skills, we have to look at Linux."

Sun's new Linux server is not the company's first foray into Linux on Intel, however. Sun had been selling Linux-based systems since September 2000, when it acquired 'server appliance' maker Cobalt Networks for $1.8 billion. These products were never marketed under the Sun brand, something that Avis believes hampered their adoption. The Cobalt line will now be subsumed into the core Sun product line up.

The differences between the previous Cobalt servers and the LX50 are small at the technical level, but significant on a corporate level. Rather than use two separate divisions to handle the LX50s and the Sun Linux distribution, the same teams that work on Solaris and other Sun products will oversee the development - and more importantly the support - of the new product, says Simon Tindall, business manager of volume products at Sun.

Furthermore, argues Sun, the LX50 is a fully-fledged server, capable of running multiple, Linux-compatible applications. Server appliances typically tend to run single applications that require little or no configuration.

But Sun's embrace of open source is by no means a total climb-down. "We think Linux has its place, but we don't agree with companies like IBM that it can do almost everything," says Avis. "It's good on one or two-processor systems, but it can't go all the way up to mainframe level." Solaris, argues Avis, has millions of lines of code evolved over years, designed to take it up to that level.

So why not feed some of Solaris' capabilities into Linux? "You have to be kidding," says Avis. "We're not going to give away our crown jewels. Sparc is by no means the fastest chip on the market, but the combination of Sparc, our hardware, our support and Solaris is our differentiator. It's what makes our systems the best."

So while Sun is establishing its own version of Linux for distribution, it is basing heavily on a version of Linux developed by Red Hat, adding in drivers specific to Sun's hardware and improving some aspects of security. The open source philosophy of "share and share alike" has not gone down well at Sun.

Neil Ward-Dutton, research director for Ovum's e-infrastructure group, says Sun's Linux strategy is just represents "a number of tactical, reactive moves that will buy the company time while it figures out how to grow its business long-term. They firm up Sun's public commitment to the platform, while not radically altering their direction in any way."

Sun's announcement, he says, shows that the company is now aware that it has to be more up-front about how it responds to customers' demands for Linux, and the LX50 fills a perceived gap in the company's product line.

"In the absence of a well thought-out strategy, this latest raft of announcements is accompanied by the deafening sound of Sun treading water," he says. So while Sun's shift in strategy may convince customers it is committed to their low-end requirements in the short-term, ultimately, its heart will always be with Solaris.

Company name: Sun Microsystems

HQ: Palo Alto, California 

Main activities: Servers, workstations, Unix/Java software

Last full year revenues: $12.5 billion

Last full year net income: -$255.0 million

Key issue: More and more of Sun's Solaris-based server customers are now looking at Linux running on Intel to run some of their low-end applications. The company's response, a line of Intel-based Linux servers, is an attempt to stop them buying outside of the Sun catalogue. However, Sun's support for the open source operating system is still grudging and companies interested in Linux for more complex tasks may look elsewhere.

www.sun.com