Sun President and COO Jonathan Schwartz on Wednesday preached the company"s multifaceted plans for success in a changing IT marketplace, citing its software and hardware as well efforts to sell compute cycles in a grid and offer services.

Demographics have fundamentally shifted in the marketplace, Schwartz said during a presentation at the Churchill Club  business and technology forum. Recognizing the trend toward free software, Sun must offer all its software for free, he acknowledged.

"It"s all going to be distributed in open source form," he said.

There have been 3 million licenses distributed for Sun"s open source Solaris OS, which boosts Solaris"s market presence, Schwartz reasoned. Sun is maintaining its OS rather than dropping it in favor of strictly Linux. This Linux-only strategy has not been successful for Hewlett-Packard, Schwartz said.

In a new development, IBM plans to support Solaris on its BladeCenter platform, Schwartz said. "A tier-1 systems vendor has now licensed Solaris," he said.