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[email protected]: Sun’s $2B Cobalt Acquisition Brings It To Entry-Level Hosting, ASP Market

“The acquisition makes Cobalt big real fast, says Stephen
DeWitt, president and CEO of Cobalt. The appliance market requires
full channel and system resources, he says. “At the end of the day,
you are either No. 1 or No. 2 or nothing else. . . . The key is
getting big fast. This lets us scale quickly.”

“In addition to the products, Sun also gets a big team of Cobalt
application developers, while Sun will provide Cobalt a much larger
worldwide distribution base, Rinnen says. … Cobalt has both
direct and indirect sales forces, McFarlane says. “[Sun] can put a
super charger behind the sales channels by giving them access to
both cobalt and Sun channel partners,” he says. “[Cobalt] gets the
keys to the cookie jar.”

“McFarlane expects twofold channel opportunities from the deal.
“[Cobalt’s] teams have partners that give us access to their
market,” he says. “And Sun’s service provider market has been
growing faster than Sun as a whole, giving [Cobalt’s] people access
to a big service provider base.”


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