Sun looks to mega discount chains for Linux PC

MENLO PARK, Calif.--Wal-Mart Stores, the world's largest retailer, has begun selling Microtel PCs that come with Sun Microsystems' version of the Linux operating system.

MENLO PARK, Calif.--Wal-Mart Stores, the world's largest retailer, has begun selling Microtel PCs that come with Sun Microsystems' version of the Linux operating system.

"We are seriously considering Wal-Mart to be the PC supplier for Sun Microsystems," Jonathan Schwartz, head of Sun's software group, said in a meeting CNet reporters early today. Separately, he said an unnamed European bank is using Sun's Linux software for 10,000 tellers.

Sun makes its money chiefly by selling servers -- powerful networked computers -- but is using the Linux operating system as a tool to expand its attacks on Microsoft and PC makers. But it's not just a Linux strategy: The company's Java Desktop System software product is based on Linux, but in the future also will be available with the company's Solaris version of the Unix operating system.

The PCs join several other Microtel Linux models that Wal-Mart has sold, including models with Novell's SuSE Linux, Lycoris and Lindows.

There are several models ranging from US$298 to US$698. The US$398 Microtel SYSWM8003, comes with an Advanced Micro Devices Athlon XP 2400+ processor, 128MB of memory, a CD-ROM drive, a 40GB hard drive, Sun's Star Office software suite, but no monitor. The US$698 SYSWM8006 has Intel's Pentium 4 processor, 256MB of memory, an 80GB hard drive, and a CD-RW-DVD combination drive.

Desktop Linux is heating up as companies launch increasingly bold attacks on the stronghold of Microsoft Windows.

Last week, No. 1 PC seller Hewlett-Packard signed a deal to ship SuSE Linux on its PCs, models that will start shipping in the second half of 2004. And Red Hat, the top Linux seller, will launch a desktop Linux product later in 2004, Chief Executive Matthew Szulik said last week.

Some believe Sun rival Dell will be the Wal-Mart of the technology world, but Sun sees things differently, Schwartz said.

"Our fundamental belief is that Wal-Mart has a much better shot at being the Wal-Mart of technology world," Schwartz said.

Sun sells its Java Desktop System to corporate users at a price of US$50 per employee per year, regardless of how many employees actually use the software. In addition, it sells its Java Enterprise System of server software at US$100 per employee per year, though that price goes down somewhat if a customer buys Sun storage gear or up if they buy programming tools.

Sun is making some headway with its server software, Schwartz said. In the quarter ended in June 2003, Sun sold the software to five companies with a total of 44,000 employees. This quarter, the company sold it to 42 companies having a total of 97,000 employees. And for the quarter ended in June, Sun so far has commitments to sell it to 100 companies with 142,000 employees, Schwartz said.