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Sun Ambushes Competition with Rocketing Sales of UltraSPARC® III Volume Systems, SUN FIRET V880 and 280R Sservers; Aggressive Price Cut For Popular SUN FIRE 280R Servers

Sun’s Entry Servers Aggressive Pricing, Strong Channel Strategy and Top Performance Appealing to Range of Customers

Carlsbad, Calif.
February 26, 2002

Sun Microsystems, Inc. (Nasdaq: SUNW) today announced that sales of its UltraSPARC® III-based entry servers are red hot. The Sun Fire]™ V880 has turned out to be the fastest selling server out of the gates for Sun. The Sun Fire 280R, another star in Sun’s volume server line, is the revenue leader within Sun’s hot-selling volume systems line. And Sun continues to bolster the price/performance benefits of its volume systems by slashing up to 28 percent off the price of the popular two-way Sun Fire 280R server.

Sun Fire V880 Entry Server Steps In and Takes Over

The Sun Fire V880 server booked more than 4,500 sales during the first two months following its introduction last October. At that phenomenal rate, Sun’s new entrant to the eight-way server marketplace is posting better sales than any of the leading competitors in that market segment today, according to IDC’s server market report for Q2CY’01, including Compaq, Dell, IBM or HP.

“We fixed our sights on the Wintel market and our customers have told us we nailed the bull’s-eye; they couldn’t wait for our new Sun Fire V880 servers,” said Neil Knox, vice president and general manager of Sun’s Volume Systems Products division. “With this server, we focused our design leadership on the fastest growing segment of the server market, and we’re delivering better price/performance with lower total cost of ownership for our customers. Additionally, with more than half of our sales flowing through channel partners worldwide, their reach and market expertise add tremendous value to our strong product offerings and make our volume strategy a very real threat to the Wintel world.”

The Sun Fire V880’s performance is superior to PC servers on many levels, according to the most recent Unix Server Pricing and Configuration Monitor Update from D.H. Brown Associates, Inc. The report states that the Sun Fire V880 offers four to 16 times the CPU cache and six times the system bandwidth than PC servers. Sun is also cited as offering the least expensive systems in the four-way Unix server market, providing a 40 percent cost savings over IBM. Overall, the report declares Sun the low-cost leader in the Unix server space.

Sun Fire 280R Outperforms Gigahertz Servers at Affordable Price
Bolstering the price/performance benefits of its Sun Fire volume servers, Sun slashed the price on its rack-optimized, dual-processor Sun Fire 280R server by up to 28 percent. Delivering enterprise-class features and availability at entry-level pricing, the Sun Fire 280R server addresses customer needs for mission-critical, network intensive and compute-intensive applications. The server provides level 2 cache, memory and system interconnect capabilities well out of reach of similar Pentium III-based Wintel/Lintel and entry-level servers.

Regarded for its performance and large memory capacity, the Sun Fire 280R server, with 900 MHz UltraSPARC III processors and running the Solaris™ 8 Operating Environment, outperforms competing Compaq and IBM 1.26 GHz Lintel servers by up to 55 percent on Sun’s Web Workload benchmark utilizing Apache web server.

D.H. Brown Associates’ Unix Server Pricing and Configuration Monitor Update confirms that Sun leads the pack in price advantage for one- to two-way Unix servers, with Sun coming in at 40 percent below the average system cost in that category.

The Sun Fire 280R provides the reliability and scalability of the Solaris platform, delivering lower total cost of ownership, reduced complexity and the seamless scalability of Sun’s binary compatible end-to-end product line.

Customers Across the Board Seek Better Performance, Lower TCO

University of Houston

In a deal worth more than $1 million at the University of Houston, researchers have built a large computational cluster–founded on the Solaris[tm] Operating Environment, Sun Grid Engine software and Sun hardware, including 13 Sun Fire V880 servers–to aggregate and manage compute power over several concurrent projects in the development of state-of-the-art environmental modeling and seismic imaging applications.

“UH researchers will utilize the new Sun computational cluster to enhance and deploy a multiscale Air Quality Model that simulates potentially harmful atmospheric conditions and assists in the development of highly accurate identification and quantification of hydrocarbon reserves for oil exploration. This will help improve utilization of national energy reserves,” stated Barbara Chapman, Associate Professor at the University of Houston.

Center for Atmosphere-Ocean Science, New York University

At New York University’s Courant Institute of Mathematics, home of the university’s Center for Atmosphere-Ocean Science, a large installation of Sun Fire 280R servers helps researchers perform data-intensive climate modeling.

“Climate modeling is a computationally intensive activity that is amenable to code parallelization techniques, such as domain decomposition,” said David Holland of the Institute. “The 64-bit, high-performance processing capabilities of our Sun systems are essential to providing the robust computing power required for our research. At the Center for Atmosphere-Ocean Science, our 16-node cluster of Sun Fire 280R servers connected by a high-speed network gives us the ability to accurately and quickly develop the data-intensive models used in the study of climate.”

About Sun Microsystems, Inc.

Since its inception in 1982, a singular vision — “The Network Is The Computer[tm]” — has propelled Sun Microsystems, Inc. (Nasdaq: SUNW) to its position as a leading provider of industrial-strength hardware, software and services that power the Internet and allow companies worldwide to take their businesses to the nth. Sun can be found in more than 170 countries and on the World Wide Web at http://sun.com