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 : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Tony Viola who wrote (69205)	11/29/1998 11:39:00 PM
From: Sonny McWilliams	Respond to of 186894

Hello Tony. biz.yahoo.com Sonny

To: Tony Viola who wrote (69205)	11/30/1998 1:54:00 AM
From: Barry Grossman	Respond to of 186894

Tony, forbes.com What's this? Sun Microsystems wooing the dreaded Intel? Suntel inside By Nikhil Hutheesing FOR YEARS Sun Microsystems Inc. Chief Executive Scott McNealy waged a holy war on "Wintel," the computer duopoly held by Microsoft's Windows and Intel's chips. But with Microsoft and Intel pointing fingers at each other in court, Sun Microsystems is reaching out to Intel, hoping to make it an ally in the battle for the server market. Sun, whose Solaris operating system runs best on its own UltraSparc chips, has also written Solaris for Intel's Pentium II Xeon chip that runs servers. More important, Sun is tailoring Solaris for the new chip that will take Intel into the 21st century: the Merced. McNealy is seeking other alliances, as well. Sun has been in talks with America Online and Netscape Communications, the Internet powerhouses that have been in merger talks in recent days. But the overture to Intel may be more crucial. Worried about Wintel Can Sun Keep eluding Microsoft? To hold on to its market share, Sun is tailoring its operating system with powerful new Intel chips in mind. McNealy has been running full-page ads hailing Solaris on Intel. "He's been pretty religious about saying only two computer companies are out there: Wintel and Sun. But when he starts writing ads supporting the 'tel' part of Wintel, it looks like he's moving in our direction," says Intel Chief Executive Craig Barrett. More than Gates-bashing is involved in McNealy's moves. Servers, which serve up data and applications on the Internet and on corporate networks, one day will comprise an even bigger market than desktop PCs. Microsoft rules in PCs, but Sun leads in high-end servers. Sun Vice President Richard Green says Intel "wants to partner with a leader in this area—and that is Sun. It's the law of nature." Sun's relationship with Intel "has dramatically improved," he says. The Sun/Intel thaw comes as tensions mount between Microsoft and Intel. In the U.S. antitrust suit an Intel executive testified last month that Microsoft had bullied Intel into halting its own Internet software efforts by threatening to yank Windows support from the coming Merced line of chips. A "Suntel" alliance offers Intel a chance to both dilute its dependence on Microsoft and boost sales of Merced chips. Solaris can handle up to 3,000 users at once, while Windows NT manages only about 600. Server makers Siemens Nixdorf and NCR have chosen to run Solaris on their Intel-based servers. Michael Pope, Intel's server-software director, won't concede the Sun-Intel relationship has changed. "We're just responding to our customers," he says, explaining that Windows is the only operating system that matters in PCs, but in servers there is "a variety of players" and "we are OSagnostic." Microsoft makes software; Sun makes hardware. Why are they such foes? Because Microsoft wants to extend its chokehold on PCs into higher-priced servers, Sun's bread and butter. Now Intel has served notice that it isn't necessarily on Microsoft's side in this donnybrook. "The real battle between us is about interface control. It's about one monopoly trying to extend itself [across all markets]," says Greg Papadopoulos, chief technology officer at Sun. Microsoft's push into high-power workstations came largely at Sun's expense; Sun's share of unit sales in that market fell to 23% in the first half of this year from 36% in 1996 as Wintel's share rose fourfold, to 52%. Sun fled to focus on midrange servers, which now provide the bulk of its sales. But even here Wintel is gaining. Sun's share in midrange servers has doubled in two years, to 14%, but Wintel-based products are at 42% and rising. Sun has countered with a new machine priced at about $4,000—down from $7,500 two years ago. So far Sun has maintained strong sales growth by emphasizing high-end servers priced at $500,000 and up, where it has a respectable 9% share compared with zilch for Wintel. That helped fuel revenue growth from $6 billion to $10 billion in the fiscal year ended June 1998. Net income more than doubled, to $763 million, in the same period. Even at this high end of the market, however, Microsoft's shadow looms. But it looms somewhat less menacingly if Sun can win a place at Intel's side. -------------------------------------- Barry