e-business: Sun hit by recession hopes for a sales lift

US network computer firm Sun Microsystems – hit hard by corporate belt-tightening – is banking on high-speed mobile services and broadband Internet access to lift sales overseas, its head for Europe has confirmed.

In a bid to generate more business from cost-conscious corporate clients, Sun has recast itself as a low-cost provider of computer hardware, software and services.

In Europe, its plan is to exploit two areas of information technology spending that are showing some promise – broadband and mobile services.

‘The mobile enterprise market is the biggest short-term revenue driver for us,’ said Elie Simon, president of Sun’s European, Middle East and Africa (EMEA) business.

The company said it will announce partnerships in the coming weeks and months with a variety of European mobile phone operators to provide them with new Java-based software and computer servers geared to making MMS, or next-generation multi-media messaging services, more secure.

In April, Sun reported a pounds 2.4 million net profit for its third quarter on sales of pounds 1.65 billion, down pounds 184 million from the same period a year ago as its once bigspending corporate clients conserve on IT spending.

EMEA sales make up a third of revenues now and will contribute 40 per cent of top-line sales by the end of fiscal year 2005, Mr Simon said.

He said sales of computing systems to government agencies will be a promising market in the coming years as the EU and individual states seek to put more of their functions online.

Sun has also made a belated jump into selling computer servers that run on the popular Linux operating system in a bid to catch up to its larger competitors IBM and Hewlett-Packard. Linux coding is freely available to the public.

Mr Simon forecast the total European Linux market would exceed pounds 1.84 billion by 2007.