Cheam Tat Inn, managing director of Sun Microsystems Malaysia, acknowledges that the company?s 2004 financial year (FY04) -- July 2003 to June 2004 -- was one of the most challenging periods during his tenure. Nevertheless, the last quarter of FY04 did provide some relief as the company registered its highest revenue growth in that period since three years ago. In addition, the first quarter of its 2005 financial year has seen Sun Microsystems Malaysia achieve a quarter on quarter growth of almost 50 percent.

?I believe we?re on the right track now and we expect this to continue for the next few quarters,? Cheam says.

In this brief interview with Computerworld Malaysia, Cheam explains what the company did right and how he plans to guide Sun Microsystems Malaysia towards further growth.

Computerworld: What contributed to Sun?s growth in the last quarter?

Cheam: We sharpened our focus in the mid-market segment. We put a lot of emphasis in establishing business partnerships and improving competencies to service this market segment. As a result, this segment contributed to the growth mentioned earlier.

We also achieved several strategic wins in the government, telecommunications, and banking and financial services sectors. At the same time, Sun Malaysia has been establishing itself as a prominent player in new areas such as Internet banking and mobile data services.

CW: What is Sun focused on now and how is it in line with the developments in the industry?

Cheam: The industry is beginning to shift from total outsourcing to intelligent sourcing, and this is what Sun has already begun to offer. The industry is also shifting towards what we term as the network economy where the role of the PC as the largest single interface to the network will start to diminish as more and more devices, such as mobile handsets, take over as the dominant interface.

When the Internet era dawned, it was based on the premise that the PC is the main interface and everything was free. Today, when we download a song to the PC we expect it to be free but when we download a ring tone to the mobile handset we?d pay for it.

The network economy is an economy that?s driven by innovations. It is changing the way we interact and conduct business. As more devices connect to the network, the growth of the network itself offers vast opportunities. Examples of such opportunities are the demand for ring tones and games on mobile handsets. The worldwide ring tone market, for instance, was worth US$3.5 billion in 2003. Meanwhile, the global market for Java-enabled games on mobile handsets was worth $3 billion.

CW: What will be the main driver of the network economy?

Cheam: The main driver of this economy is Java. We believe that it is already powering the network economy with more than 350 million Java-enabled handsets already shipped. Java will be a dominant single, universal platform for all devices to communicate on the network.

Mobile data services, such as services for GPRS and 3G, is also expediting the convergence of IT and communications technology, which is already happening today. This is another area where Sun can leverage our Java technology-based mobile data and services offerings.

In addition, we have the aspiration to churn out 50,000 Java developers and architects within a three-year timeframe. To increase from the current 5,000 to 50,000 is indeed a challenge. That explains the inception of the Java Technopreneur Development Centre last year. It is a joint effort with the Multimedia Development Corporation and the Multimedia University to support Malaysian startups and individuals who have good ideas with technical assistance, funding and marketing of their final product.

CW: How do you plan to move the company further ahead this year?

Cheam: We have several major goals. Firstly, it is to develop different strategies for different market segments, and deliver value-added solutions and services rather than just sell hardware. In addition, we are looking hard at all our offerings to see how we can establish new revenue streams.

We are also looking at better ways in working with our business partners. As much as Sun is transforming, our partners will also have to adapt to changes. It is not just about selling hardware anymore. They will have to scale up and build competencies and behave as if they were Sun Microsystems, with the ability to deliver a full spectrum of not just products but services as well.

CW: Are you going to specifically focus on the SMEs to boost adoption of open source?

Cheam: Yes, we are seeking ways to drive and increase our market share in the Linux space as well as AMD?s Opteron processor-based x86 systems amongst the SMEs. Thankfully, our alliance with AMD has expanded our potential addressable market. In addition, we are working with a few government bodies to deploy open source technology and applications such as our StarOffice Suite. We are also working with local partners to offer StarOffice preinstalled in notebook computers at attractive prices.

The market for Java technology, meanwhile, is definitely getting stronger and gaining a lot more acceptance especially with our subscription-based model, and this is one area that will help us move forward.

Overall, you will see a more focused marketing effort and more initiatives put into increasing user awareness that Sun is not just selling Unix servers. We are targeting a 50 per cent growth in revenue and given the current rate we expect to achieve or even overachieve that target.

We believe we have the right strategy and the results are showing. There is still room to grow. Give Sun three more years and you?ll see a totally different company.