It sounds to me like an insanely great deal: $100 per employee for *all* the server-side components that Sun produces from OS through App server to directory and mail servers and more. And you can use the software internally and externally - there's no additional fees for public usage. The desktop solution is basically a customized RedHat Linux plus StarOffice, but at only $60 per user per year, this also seems to be a decent deal, because remember, all of this comes integrated with support as well.
The message continues... 30 minute installs, no hidden fees, etc. etc. And not only have they wrapped all this up with an interesting new cost model, they've brought all the pieces under the Java umbrella, undoubtedly their single greatest company asset. "The Java System". Wow... It's like Sun finally accepted the fact that they can't push high-end boxes forever and finally realized that they need to look down the road a bit to a different way of doing business: They could either try to fight Microsoft on their own turf, or look towards Salesforce.com's services model and decided to try a combination of the above. Personally I think it's great. It's just like have a subscription to the MSDN libraries from Microsoft, but you get to *USE* all that software without having to worry about per-cpu or access licenses.
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[Russell Beattie Notebook]
Russell's comments on the new Java System are interesting. If Sun is providing a real support infrastructure for this offering and is able to reach out to system administrators and IT decision makers, this may become compelling from a TCO perspective. I probably won't be switching from Office 2003 anytime soon, but I'm definitely going to be taking a look at this to see the software and to understand the installation, documentation, and support stories that go along with this initiative.