Sun Anticipating the 'Red Shift'

| About: Sun Microsystems (JAVAD)

Sun has changed its ticker symbol to Java (JAVAD) and performed reverse stock split surgery, but the focus on the company remains consistent–be the infrastructure provider for the wired planet. The mission was reaffirmed last night by Sun executives during a dinner with a few journalists at the trendy Absinthe restaurant in San Francisco.

“By this time next year, we will start looking at the market through red colors,” said Greg Papadopoulos, Sun CTO and executive vice president of R&D.

Papapopoulos means that his notion of a Red Shift, a move to massive scale computing infrastructure, will become more of a reality in the next year.

Papadopoulos’ defines Red Shift as the part of computing underserved by Moore’s Law. Demand for high performance computing, Internet-delivered applications and rich content and services is growing faster than Moore’s Law can satisfy. This demand can only be met by “brutal efficiency at scale of engineered systems,” said Subodh Bapat, vice president of Sun’s eco-computing team, said between courses.

Supplying scale efficient infrastructure to deal the last-mile bandwidth (NYSE:BW), high-performance computing (HPC) and on-demand applications (*Prise) is the Redshift. Source: Sun

Sun is betting on what Papadopoulos termed a “neutron star collapse of datacenters.” At some point it won’t make sense for businesses to build their own datacenters, but to get resources from hosting providers “brutal efficiency” for utilization, power, security, service levels and idea-to-deploy time can be rendered. Sun wants to provide the infrastructure for the hosters and to be a host itself.

As an example of the coming Red Shift and massive scale, the Department of Energy’s Oak Ridge National Laboratory is building 500,000 square-foot datacenter with 50 megawatts of power, which is enough electricity to power a small city.

I asked Papadopoulos for specific data points on the Red Shift phase change happening next year. He cited the amount of computational work done or microprocessors in Red Shift applications, such as high performance computing and software-as-a-service in the enterprise.

The Red Shift may express a faint red tinge next year, but it will take at least a decade for a substantive phase change.

In a previous interview, Papadopoulos has said that the earth’s compute resources will resolve into about “five hyperscale, pan-global broadband computing services giants,” and gave examples of Google, eBay,, Microsoft, Yahoo,, and the “great computer” of China.

Source: Sun

It’s not difficult to imagine such a scenario. The more near term issue is whether Sun can intercept the growing demand for compute power. A recent IDC report showed Sun holding its own in the server market, but not increasing its share. Gartner showed Sun going from 10.1 percent market share in Q3 06 to 11 percent in Q3 07.

Source: IDC Top 5 Corporate Family, Worldwide Server Systems Factory Revenue, Third Quarter of 2007 (Revenues in Millions)

Sun is hungry to duplicate the success it had in the great telecom build out in the previous century in this new world of services. We will know if Sun is benefiting from the Red Shift phases if the market share numbers start to climb, as well are revenue from the more margin friendly high-performance segment.

A few comments about the dinner at Absinthe to round out this post with a hunger theme. The puree of parsnip and Pippin apple-micro herb salad with a drizzle of mustard oil was complex and quite tasty. The grilled halibut (misrepresented on the menu as sea bass) with butternut squash puree, pecan brown butter vinaigrette, watercress salad was undercooked and unimpressive.