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Is Sun Setting?: Page 2 of 4

“There is no theme that holds it all together, such as [IBM’s] on-demand computing, which says, ‘This is going to make your business better.’ ”

With a major reorganization now underway, Sun acknowledges that things need to be changed.

Sun is also pinning its hopes on its new partnership with its former archrival Microsoft Corp., which has never been one to cheer for Sun's success (see Microsoft, Sun Settle Litigation).

Under a broad technology agreement, the two companies will cooperate on Microsoft's Windows Server and Windows Client products. Eventually, the relationship will be extended to email and database products. This, at least, has pleased users, who are keen to improve the interoperability of their Sun kit and Microsoft software.

At the same time as the Microsoft announcement, the company revealed that it is cutting 3,300 jobs, which represents 9 percent of its workforce -- not exactly a confidence builder.