InformationWeek > Sun Microsystems > Sun's Extreme Makeover > October 18, 2004: "Sun has been standing its business model on its head--transforming its most-important commercial software into open source, embracing standard chipsets, converting rivals into partners, and tailoring subscription-style services.. Next month, Sun is bringing out Solaris 10, an upgrade to its flagship Unix operating system that's more finely tuned for x86 microprocessors. This week, it's unveiling more pay-by-the-drink pricing options for grid computing. By year's end, it plans to finalize a sweeping plan to make its software available as open source, including a version of Solaris. And around the first of the year, it promises interoperability with Microsoft's identity-management and directory-services products.

Sun is betting it can make money from service and support agreements, not unlike Red Hat Inc.'s approach to Linux. "'f you want it fully supported or want input into new features, then you might have to pay for that,' Loiacono says.

It's part of a broader push into a software-as-services model. Sun provides hosted storage on an as-needed basis, and, in January, it established a $100-per-seat model for its Java Enterprise development platform, which has attracted more than 345,000 customers. Sun also introduced in September hosted grid computing for $1 per processor per hour and this week will disclose details of a plan for third-party hosting.

November's Solaris 10 launch comes after much work to optimize the operating system to run on x86 microprocessors from Intel and Advanced Micro Devices Inc. Sun finally hopes to smash the perception that Solaris' quality and performance come at a steep premium. Solaris is 'cheaper than Windows and less expensive than any of the major Linux distributions,' Loiacono contends.

In addition, Sun is almost ready to play its Microsoft card. Having reached earlier this year a $2 billion legal settlement that included cross-licensing of technology and a joint-development agreement, Sun and Microsoft have identified up to 20 areas of potential collaboration. Within the next 90 days, they'll deliver the first fruits of that work.

The companies will provide single-sign-on capability for Microsoft's Active Directory and the Java Enterprise LDAP Directory. Sun's CTO, Greg Papadopoulos, and Microsoft's chairman and chief software architect, Bill Gates, have been working closely the past few months on a road map to bridge the Sun and Microsoft environments. The companies say they'll unveil integration products a few times a year over the next 10 years, concentrating initially on interoperability among their messaging services, applications, and systems management. 'I don't anticipate that Microsoft is going to do any kind of similar deal with any of our major competitors,' Loiacono says. 'We have the inroad into technology and interoperability with them. Red Hat's not going to have this capability.'"