InformationWeek

September 22, 1997

Sun Offers Server Deal

Integrators to build, sell servers based on Sparc, Solaris

un Microsystems is trying to push into commodity server markets through a deal that will let systems integrators build and sell Internet servers priced below $10,000 that are based on Sun's technology.

Sun's microelectronics division is providing MicroAge, Nevcor Technologies, PC Wholesale, and Western Micro Technology with a motherboard based on Sun's UltraSparc processor, as well as Sun's Internet software, the companies said last week. The four integrators will then sell servers based on the boards to resellers who in turn will sell them to medium-sized and small businesses .

Sun says the deal will help it better compete with Microsoft and the Santa Cruz Operation, both of which rely heavily on resellers and integrators. "We have a systems company mentality, but to grow as a company, we needed to find a creative model," says Mike Gallagher, group marketing manager at the Sun microelectronics division.

The agreements mean users will be able to buy a Solaris-based generic server-sometimes without a brand name or logo-from a wider variety of resellers. It also means that these servers could be offered at a lower price than Sun-branded systems, because they won't include the overhead associated with a direct sales force. "That's a very low-cost channel, compared with a direct sales organization like Sun has," says Nathan Brookwood, an analyst at Dataquest Inc. "It's real expensive to make a sales call, and that's reflected in the pricing of a product."

Sun's computer company will focus on selling Internet servers to large companies. The integrators have agreed to use re sellers that don't already offer Sun machines to avoid cannibalizing Sun's revenue.

Sun's recent move to the PCI bus standard makes assembly easier for systems integrators, analysts say. The servers will use a PCI-based Ultra AX motherboard with a 167-MHz or 250-MHz UltraSparc chip. Software includes Sun's WebServer platform, Solstice Internet Mail Server, SunScreen Skip encryption, and SunScreen EFS firewall. MicroAge started shipping servers last week, and the other vendors are preparing to ship within days. The servers will typically cost less than $10,000.

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