Update: McNealy - Sun to ship Opteron servers in 2004

LAS VEGAS -- Sun Microsystems Inc. plans to begin shipping in 2004 two new servers based on Advanced Micro Devices Inc.'s (AMD) Opteron processors, Sun's Chief Executive Officer Scott McNealy said during a Comdex keynote address in Las Vegas on Monday.

The servers, which were literally unveiled onstage at the end of McNealy's keynote, are part of an alliance the companies have been planning for the past year, according to Neil Knox, Sun's executive vice president of volume systems products. Under terms of the agreement , Sun will work with AMD to produce a range of Opteron systems, beginning with two- and four-way servers that will begin shipping in 2004.

McNealy provided no details of the new Sun Fire servers, which are 1U (4.4 cm high) and 3U (13.3 cm) in size and which he and AMD CEO Hector Ruiz showed on stage. But McNealy did say that developers would be able to get early access to the new servers later this year.

The Sun endorsement is a major step for the 64-bit Opteron processor, said Ruiz. "It validates the fact that this technology is sound," said McNealy, who is also Sun's president and chairman.

Sun follows IBM Corp. as the second major server vendor to commit to selling Opteron systems, which AMD launched in April of this year.

While Sun may be ahead of competitors such as Dell Inc. and Hewlett-Packard Co. in embracing Opteron, McNealy admitted that Sun was late to the x86 (Intel instruction set) game. "We (missed out). I wish a heck of a long time ago we'd done the strategy we did with Intel," he said, "That low end x86 product line is now the fastest-growing part of our computer product line in the data center."

Sun was not only late to market with x86 products, the company also precipitated a user revolt in January 2002, when it announced plans to terminate its Solaris for x86 operating system. Nine months later it reversed that decision.

With Monday's announcement, McNealy argued that Sun was making its commitment to the x86 architecture clear. "We nailed this one on the button," he said. "I think this will help our x86 sales because it says we're serious."

But the move to Opteron also raises questions about Sun's other x86 products, said Nathan Brookwood, principal analyst with Insight 64 in Saratoga, California. Sun's one-way and two-way Sun Fire V60x and V65x servers, which are based on Intel's Xeon processors, compete directly with the upcoming Opteron products, according to Brookwood. "It would seem to me that it would be in Sun's interest to winnow the product line down," he said.

Sun's Knox said that while his company has no plans to develop new Xeon systems with more than two processors, it does intend to sell some follow-on Xeon systems. "We have got some customers who have adopted the Xeon platform and we're fairly sensitive to whipping them back and forth," he said.

Also during the keynote, McNealy announced an agreement between Sun and the China Standard Software Co. Ltd. to develop desktop computers based on Sun's Linux-based Java Desktop System that could eventually see the software installed on hundreds of millions of computers in the People's Republic of China, according to McNealy.