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Sun and Microsoft deal signals a nod to reality

The new Sun/Microsoft partnership that allows Sun to sell its x64 servers with Windows installed and supported gets blessings from industry observers.

Earlier this month, the partnership announcement from Microsoft Corp. and Sun Microsystems Inc. got industry observers talking, and most say the collaborative partnership makes perfect sense.

For more on Sun Microsystems:
IBM to sell Sun Solaris on mainframes; pigs fly

Solaris upgrade continues push among Linux users

In mid-September, Sun signed an agreement to package, sell and support Windows Server OEM, and the two companies plan to collaborate on cross-virtualization capabilities.

The Sun also rises
Given the bad blood between the two companies in recent years --including a lawsuit that resulted in Microsoft's paying Sun $700 million to resolve antitrust issues and $900 million to resolve patent issues in 2004 -- the news came as a surprise. Around the same time, Sun's current CEO, Jonathan Schwartz, was promoted from executive vice president of software to president and chief operating officer and, later, to CEO. The two companies also began paying royalties to use each other's technologies.

We can walk and chew gum at the same time. Running, virtualizing and supporting Windows opens doors.
Jonathan Schwartz,
CEOSun Microsystems Inc.

On the flip side, Sun has been certifying Windows on its platforms for quite some time, and the partnership is beneficial for both companies, analysts report.

"The fact is that while Linux is an extremely popular option for x86 servers, Windows is the dominant OS in that space," said Charles King, principal analyst at Hayward, Calif.-based research firm Pund-IT Inc..

Despite Sun's continuing promotion of its own Solaris, certification of Windows is a simple nod to reality.

Gartner Inc.'s George J. Weiss, VP and distinguished analyst, and Philip Dawson, research VP, analyzed the partnership and see this as a shift in how Sun competes in the server market: that is, by keeping friends close, and enemies closer.

"Before the tenure of Sun's current CEO, Jonathan Schwartz, the company appeared to view the IT market as divided into a landscape of hostile or friendly vendors and was averse to partnering with its rivals, especially IBM and Microsoft," the Gartner analysts said. "Now Sun has fostered relationships with its historical competitors, and this strategy will enhance Sun's image as an increasingly relevant technology supplier of both hardware (particularly systems) and software (for integration)."

Industry watchers take partnership in stride
While several bloggers were stunned by the deal, calling it "Sun's most bizarre move yet," others weighed in, saying that the partnership isn't all that surprising.

"Sun has been moving toward a more HP-like model for many years," said the blogger Shakin. "In a way this isn't any more unusual than Sun selling Linux servers. ... In fact [Linux] may be more unusual because Linux is a more direct competitor to Solaris than Windows is. Sun wants to be the company you go to when you need a highly scalable and highly reliable server. They make great hardware. What software you put on it is secondary to them."

The blogger "Bigblackman" highlights the wisdom of the deal from a business perspective. "You're already buying Unix servers from Sun, [but] who do you call when you need some Windows servers? Maybe HP or Dell before, but now you just keep on dealing with Sun."

Schwartz sounds off
A defensive CEO Schwartz insisted that this agreement did not signal a strategic shift inside of Sun. In a Sept. 16 blog post, Schwartz wrote, "It opens more opportunity, puts our past behind us, and gets everyone focused on Sun's virtualization, Solaris and Sun's Systems portfolio – independently. We can walk and chew gum at the same time. Running, virtualizing and supporting Windows opens doors.".

Executive Vice President of Network Systems John Fowler said that Sun has been expanding its X64 server business for seven quarters and is on the cusp of announcing its next-generation X64 platform.

The exact percentage of x64 users running Windows on the platform is unknown, because Sun sells its hardware through different avenues, but Fowler said the number is growing.

Schwartz said "[Microsoft's] SQL Server screams on products like [Sun's] x4500" and said Sun already does a ton of business with Windows on its hardware and software, with most Java developers today using Windows, he said.

"Our current lineup now completely integrates our Sparc and x64 systems and supply chains," Schwartz wrote. "So when you buy a blade system from us, for example, you can intermingle Sparc, AMD and Intel blades, manage them all identically, while running Linux, Solaris and Windows -- under Project Virginia as well as VMware's offerings. We can serve 100% of the market."

The Sun/Microsoft agreement
Sun will sell and support Windows on its platforms and continue to certify all of its x64 platforms for Windows, as it has done for some time. Microsoft will also support Project Virginia, Sun's soon-to-be-announced hypervisor platform, Schwartz wrote. Sun will support Windows virtualization when it hits the market, and Windows will do the same for Solaris.

The two companies will also create an interoperability lab at Microsoft's headquarters in Redmond, Wash., to collaborate on configurations and testing between their hardware and software lines.

For virtualization, Windows guests will run on Sun's XenSource Inc.-based hypervisor or Solaris guests on Microsoft Virtual Server, also known as Viridian, when it becomes available in 2008.

Gartner analysts point out that the current agreement does not include Windows.NET and Java applications or middleware interoperability. Also omitted are desktops and system management and lifecycle issues, including processes, policies and patch management.

Microsoft will benefit from the deal because it broadens OEM support for Windows and Microsoft applications and could strengthen its footing against Linux -- a key competitive concern for Microsoft, Gartner analysts said.

Pund-IT analyst King said the move won't be hugely important for Microsoft from a revenue standpoint, but it puts the company in a good position in the virtualization space. "As Microsoft moves to engage VMware, it's important that its virtualization solutions perform as advertised on every vendor platform," King said. "The Sun deal should help ensure that happens."

Let us know what you think about the story; email Bridget Botelho, News Writer.

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