Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: jim kelley who wrote (24861)	12/15/1999 11:26:00 PM
From: fuzzymath	Read Replies (1) \| Respond to of 64865

Very interesting viewpoint, Jim. I was very disappointed at Sun's action with the Java standardization matter a while ago. No one else here seemed concerned. As I said in an earlier post, PC's (because of Intel, not Microsoft) began putting enormous pressure on UNIX machines, which were substantially higher priced. Linux, then, would have to be considered a further threat. So the huge rise in a stock like Red Hat could be seen as a threat to Sun's moneymaking activity: sales of UNIX boxes. I still think Sun is a great company. They're taking the approach of spreading their influence as a means of becoming the leader in future technology. I guess that's why the standards thing bothered me. That's a game Microsoft learned to play and play well. There is a game to be played in the standards arena. It seemed to me that Sun was making it look like they were ducking out, which is bad publicity... Regarding puts--so if I'm advising people to hedge right now, you'd agree that the index puts (or QQQ or SPY puts) I've mentioned are an efficient method? I sometimes think of selling index futures short too. Microsoft also announced today in a "secret" public message that its new Java release development kit is available on their web site. Kevin

To: jim kelley who wrote (24861)	12/16/1999 10:35:00 AM
From: rudedog	Read Replies (3) \| Respond to of 64865

Jim - re: IBM has released a new R6000 server which is much faster and cheaper than the Starfire I question this - as far as I know, the biggest RS6000 is the S80, announced in September, which supports 6 to 24 processors SMP. It is really a competitor to the UE6500, not the UE10,000. The UE10000 is distinguished by much more than simple number of processors, however - the "switch fabric" design supports static and dynamic partitioning with almost no performance penalty, a big selling point in the markets where starfire is dominant. Only CPQ's Alpha "wildfire" has a similar design, and "wildfire" is still a prototype with no real release date. Java is much more than "just" PR. I agree that it does not make money - what it does do is provide the perception of architectural dominance. IBM's "WebSphere" initiative is EJB based as is the HP "eSpeak" program. While one could argue that these initiatives take EJB leadership away from Sun, Sun still holds almost all of the Java cards, and the fact that the other major high end players have gone in that direction just reinforces the value of Sun thought leadership. Itanium (Intel IA64 products) will eventually put pressure on Sun, but not any time soon - Intel will only support a 4-way chipset for Merced, hardly the kind of product which will make inroads into SUNW's bread and butter. Real IA64 "big systems" will not appear until at least McKinley, probably in late 2001 or early 2002. And those will probably not be equivalent to the big UE products in that time frame. Finally, that part of the high end market is not just about hardware, in fact there is little reason to think that hardware is more than the ante to the game. Only HP, IBM and CPQ have the related services and support to drive into that space, and then only with UNIX offerings, which plays into Sun's long suit. As far as Workstation and low end server sales, one of the big benefits of the large UE machines is their ability to "pull" smaller Sun boxes which might not be competitive in their own market space. I have seen a number of systems sold into financial institutions where the presence of one or 2 UE10,000 machines and a handful of UE6500's pulled through big numbers of smaller servers and workstations, when the smaller products were 2X or more the cost of Intel-based machines. The reason is that reduced administration and other systems costs more than offset the HW capital cost, which represents less than 8% of overall cost. You can double the capital costs and if the admin and support costs drop by only a few percent, the customer is still money ahead. Sun salespeople have used this argument to good advantage, along with the "headroom" argument, and the "architectural leadership" argument.