Sun to Sell Low-Cost PC Software Bundle

Sun Microsystems Inc. today will introduce an inexpensive package of software to run desktop computers that is based on the Linux operating system, gambling that cost-conscious companies are ready to defect from Microsoft Corp.

Sun, which is best known for making powerful workstations and server computers, cobbled together the $100 system from a free version of Linux, the free Mozilla Web browser, a free e-mail program and Sun’s own StarOffice suite of word processing, spreadsheet and other productivity software, an alternative to Microsoft Office.

Corporate customers that already pay $100 per user per year for some of Sun’s more traditional server offerings could get the desktop package for as little as $50 a head.

By comparison, a PC owner buying the least expensive versions of Microsoft’s Windows XP operating system and Office productivity suite would pay about $600. A corporate customer buying licenses for hundreds of users would pay far less.

Other companies, including Red Hat Inc. and Lindows.com Inc., already offer somewhat user-friendly versions of Linux that sell in the $40-to-$90 range.

Part of what sets Sun’s offering -- dubbed the Java Desktop System -- apart is that the company is committed to integrating it with Sun’s larger-scale machines and software, said Mark Hinkle, an organizer of the fledgling Desktop Linux Consortium, which doesn’t include Sun. That means companies using Sun’s software for managing corporate networks could easily distribute upgrades for the desktop system to PCs throughout an office.

“It’s going to help Linux adoption overall,” Hinkle said.

Since Sun outlined its idea for a Linux desktop system last year, Linux enthusiasts have looked to the Santa Clara, Calif., company to make the operating system more accessible to regular computer users. Some of Sun’s customers helped persuade the company to broaden the audience for the Java Desktop System beyond its initial target of call-center employees and other specialized, low-level workers, said Peder Ulander, a Sun marketing director.

Sun’s chief strategy officer, Mark Tolliver, said the software package also might appeal to many home users who are looking to upgrade PCs running older versions of Microsoft operating systems, especially Windows 95 and Windows 98.

“It will sell in the hundreds of thousands, maybe even the low single-digit millions,” Tolliver said. “It depends on the extent to which people are willing to unhook from the total Microsoft desktop package” of Windows, Office and a wide range of smaller programs.

Ulander said some major PC manufacturers and Internet access providers were considering distributing the system to computer users who have little direct contact with Sun. Sun declined to name those firms or its test customers, which Sun said included government agencies. The software package will begin shipping in about six weeks.

Sun previously had touted low-cost, low-function computers for use in retail outlets and elsewhere, but those products have had little effect on the company’s bottom line.

“When the rubber met the road last time, there wasn’t the commercial acceptance,” said Sanford C. Bernstein analyst Toni Sacconaghi.

“The question is: Is there something unique about a Linux desktop to get over that?” Sacconaghi said, adding that the Linux-based PCs would do less than machines running Windows.

At a conference for Sun developers and customers this week, executives will try to make the case that much has changed since Sun’s past introductions of low-cost computers, such as SunRay. Corporate technology buyers are more interested in saving money now, and the spate of worms and viruses attacking Windows computers makes Linux a more attractive alternative, Ulander said.

Analysts say Microsoft, which has more than 90% of the desktop market, has hurt itself by steering customers toward frequent upgrades, some of which require expensive hardware.

Sun shares dipped 6 cents Monday to $3.86 on Nasdaq.