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McNealy holds hope for 'iPod moments'

Sun CEO lays out six initiatives he hopes will transform his company's tarnished image. Photos: McNealy takes the stage

SAN FRANCISCO--Sun Microsystems CEO Scott McNealy has long admired Apple Computer CEO Steve Jobs' abilities in transforming his company and marketing its products. On Tuesday, he paid homage by listing what he believes will be his own company's "iPod moments."

McNealy, speaking at the Oracle OpenWorld conference here, said he believes Sun has six major initiatives that will be able to help turn around the company's business prospects in as dramatic a fashion as the iPod did for Apple. If he's right, the products could restore not just Sun's revenue growth and profitability, but also its visionary reputation, which was tarnished during the years after the dot-com bubble burst.

"This is the $8- to $10-billion of research and development we've done over the last five years starting to bear fruit," McNealy said. "Any one of these activities, I believe, could be our iPod moment. I expect to hit on all of them. But if we just have a Barry Bonds batting average, we'll do just fine."

Photos: McNealy keynote

The moments:

• Sun's "Galaxy" line of x86 servers, machines designed by Sun co-founder Andy Bechtolsheim and launched last week. Sun shunned the x86 market for years, but now hopes Advanced Micro Devices' Opteron will help the company move into fourth place in x86 server sales by the end of 2006.

• UltraSparc processors, the mainstay of Sun's Unix server line. Sun introduced the UltraSparc IV+ on Tuesday, a model that doubles performance over its predecessor.

• Solaris 10, which Sun released as open-source software earlier this year in an effort to attract more developers, users, software allies and--the company hopes--support contracts. "Only by creating huge communities can you make a difference. And you can only monetize large communities," McNealy said.

• StorageTek, which Sun acquired for a net price of about $3 billion. Sun believes the tape storage company will provide an entry into IBM customer accounts and give the company a large, credible storage salesforce.

• The Java Enterprise System, six suites of server software that Sun sells for $50 per employee for unlimited use. The entire six suites also can be purchased for $140 per employee per year.

• Thin clients, both the Sun Ray terminal that people use and the server software that does the actual processing work. Sun licensed Microsoft's Remote Desktop Protocol and acquired Tarantella, letting central servers run Windows desktop applications that are shown on Sun Rays--a move that McNealy said will make it easier to scrap PCs and adopt thin clients. "Now you don't have to go cold turkey. We have a hit of methadone or a nicotine patch," he said.

Sun has grander plans for thin clients as well, McNealy said. Today they work over broadband and 802.11 wireless network connections, but in the future they'll also be able to use 3G cell phone networks and will be augmented with voice over Internet Protocol (VoIP) abilities.

And Sun expects to sell thin client desktop computing as a service to customers, McNealy added. "We haven't yet launched the display grid, but I'm counting on $1 per display per day," McNealy said.