Sun Growing Significantly Overseas

Sun Microsystems (Nasdaq: JAVA) recently reported decreased revenues for the fourth quarter of its fiscal year, but you wouldn't know anything was amiss by the other actions of the company.

Sun is planning massive investments overseas -- primarily in India -- and has reached deals to develop new thin client technologies. All of these important developments seem to have been lost in the glare of the three percent sales decline for the quarter.

Sun says it has invested US$150 million in India during the last seven years and plans to "accelerate" that, said Bhaskar Pramanik, managing director of India for Sun, during a news conference. After India, the company is stepping up investment in Russia, the Czech Republic, and China, where it will add facilities and personnel.

India and China

The company's fastest growth in Asia came from India, not China, for the year, said Pramanik, noting that for the last 12 months, sales increased 28 percent at Sun, seven percent higher than the overall IT market. "Tremendous growth" is coming from technologies like its X64, store and services for Sun, said Pramanik. "FY 'O5 was a year of stabilized revenues and improved earnings for Sun globally."

Future growth is likely to come from overseas as well. The company reached a deal with the United Nations this week to provide IT for the Pan-African Youth Leadership Summit in Morocco, a project to mobilize a "new generation" of leaders in Africa. Sun is providing the networking technology for the project, and the training to assist the delegates to go online, and collaborate online.

Right now, only one percent of people living in sub-Saharan Africa use the Internet. For other developing areas, the figure is about 4 percent. This may change in the future -- as Sun is providing training for the youth leaders from these developing countries as to how to produce blogs, Web sites and chat groups.

"We are moving beyond connectivity to participation to enable a new generation to use ubiquitous global access and build a future for themselves," said John Gage, Sun's chief researcher.

Access to IT

Access to new technology is crucial to "engaging and connecting young people, but it is largely unavailable in the developing part of the world," added Djibril Diallo, director of the U.N. New York office of sport and development.

The training project in Africa is going to give Sun an edge in the developing world, experts believe.

There are other projects on tap for Sun that are likely to be high-profile in the coming years too.

The company this week disclosed that it is working with NTT Data Corp. to offer a secure, thin-client solution. Another partner in the project is GraphOn Corp. The Japanese are the target customers for this computer -- as they are seeking technologies which can "visualize" their work processes, Sun said. Financial institutions, manufacturers, and other companies are eyeing the technology, the company added.

"Putting our cash to work, we've expanded our product portfolio and announced plans to acquire companies that deepen and broaden our systems strategy," said Scott McNealy, chief executive officer of Sun. "We've materially grown our key communities including Java, Solaris, and SPARC. We've maintained our R&D commitment and ... delivered Solaris 10 to the market."