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Sun tries to rise again

Who was that ponytailed fellow from Silicon Valley walking a crowd of Wall Street executives last month through the latest in utility computing, high-throughput servers and multithreading microprocessors?

Who was that ponytailed fellow from Silicon Valley walking a crowd of Wall Street executives last month through the latest in utility computing, high-throughput servers and multithreading microprocessors? Try Jonathan Schwartz, president and COO of Sun Microsystems. Schwartz rode into the Big Apple eager to convince "the world's most demanding customers" -- technology buyers at the biggest financial institutions -- that Sun should again be taken seriously as a supplier of their most-critical computer systems. "This was the spawning ground for Sun," said Schwartz, referring to Wall Street's embrace of its systems for quantitative and trading needs in the 1980s. "And this is exactly where we believe we have to return."

Emceeing a glitzy "Take Back Wall Street" event at the W Hotel near Manhattan's Union Square, Schwartz contritely apologized for Sun's failure to keep pace with the industry's changing needs. He acknowledged that his company had stuck too stubbornly to its proprietary chips and platforms as customers flocked to the cheaper and more flexible Linux operating system -- a big reason that Sun's annual revenues eroded by 39 percent between 2001 and 2003, to $11 billion. "You came to us with your wish lists, and our shelves were empty," admitted the 38-year-old former McKinsey consultant, who joined Sun in 1996 and became No. 2 to CEO Scott McNealy in April.

But noting that revenues are rising again -- 4 percent, to $3.1 billion, in Sun's fiscal quarter ended in July -- Schwartz declared that the shelves are restocked: "We've spent the past three years getting back to our roots in open standards and open architectures. If you are looking for innovation and price performance, there is no better partner than Sun."

Is Sun really rising again? "It seems to be doing the right things," says Joel Scotkin, CEO of New York­based financial-systems consulting firm Random Walk Computing. "But Sun has left a lot of our clients confused, and it will take time to see if the strategy pays off." Standing up for Sun, Bill Morgan, chief information officer of the Philadelphia Stock Exchange, says, "My hot buttons are stability and capacity, and they've done a good job for us." The company could use more such testimonials.