An ambitious goal that sparked skepticism

Sun wants to believe in its rebound. After multiplied product launches and returned to Dell title number three global servers in the second quarter, the new pattern of Sun Microsystems, Jonathan Schwartz, have changed the perception of the company on the market. "There has been lot of cynicism about Sun in recent years, says Jonathan Schwartz, but things have changed." We foster the interest, not only because of our "roadmap", but with our products. "The launch, a year ago, ranges of x 64 servers using AMD chips, and especially the rise of its range of machines owners Niagara played for much of the return in force. "The take-off of these lines has been incredible, says Jonathan Schwartz.". At the current sales level, they account for about $ 1 billion in additional revenue annually for Sun.

However, after five years of losses, the company remains in a difficult position. Sun will eliminate 4,000 to 5,000 jobs during fiscal year 2007 and hope thus saving between 480 to 590 million dollars per year. R & D budget has also reviewed downward, and a number of cancelled projects, especially in the chip. A decision heavy meaning in a company where innovation has always award winning. "For me, the question is not about how much you spend on R & D project, but rather to be sure that you spend effectively, says Jonathan Schwartz." In this context, we have two things. We have reduced our budget because we have seen that part of our R & D was spent inefficiently and we have redeployed a large number of our engineers on products offering the most potential. "But this redeployment has its limits. No question, for example, for the new pattern of Sun to take distance with market Unix now in decline. "Why hell do we then this just just to surpass our competitors in servers, with two-digit growth" I think that companies that have made this choice, such as Hewlett-Packard, have abandoned their base installed at the competition.

Return to a margin of 10

Determined to give opportunities to the company, Sun announced late may its willingness to reach an operating margin of 10 in the long term. An ambitious goal that sparked skepticism. "This figure has left some observers doubtful, recognizes Jonathan Schwartz. In the first place, we will all efforts to achieve an operating margin of 4 in the fourth quarter of our fiscal year 2007. But if we keep our costs to a relatively constant level and generate growth, we should substantially improve our margin in the years to come. "This new pattern of Sun believes that the evolution of high-tech market should play in his favour. "The sector is evolving in two different directions." There are first actors as financial institutions, media companies or governmental organizations, who consider the information as essential technology and which will continue to invest significantly in the years to come. And then there is the vast majority of companies, who would prefer to invest these amounts in their hearts of business and not in an IT infrastructure. These companies will buy more services from vendors like Salesforce, WebEx or France Telecom. But all these suppliers, these are today our clients.