Sun announced plans to offer users a suite of integrated software and server, products priced at $100 (£67) per employee last week.
Sun's suite of software, unveiled at the SunNetwork 2003 Conference and Pavilion in San Francisco last week, will compete with server software from Microsoft and IBM, both of which command dominant positions with IT users.
But industry experts are not convinced Sun can build a viable software business. In particular, its European IT services operations are not as thorough as those from IBM or Microsoft, said Jyoti Banerjee, chief executive of IT research company MyBusiness.net.
It is not the first time Sun has tried to break into the software business. "Sun has been pushing Java for years. It should be the most dominant Java company," he said.
Yet, according to Banerjee, Sun's success in software has played second fiddle to hardware sales. "My biggest concern is whether Sun can balance being both a hardware and a software company," he said.
Clive Longbottom, service director at analyst company Quocirca, said Sun would have difficulty convincing users to replace Microsoft Office with Staroffice. "With the imminent launch of Office 2003, how can Sun guarantee compatibility?" he asked.
He warned that Star Office users could lose business if they are unable to open e-mail attachments containing Office 2003 documents.
However, Alan Pelz-Sharpe, vice-president for research at Ovum, was impressed by the latest pricing news. "Sun's software business is motoring ahead," he said. But while the new pricing looked attractive, until users start buying into the strategy it would be hard judge whether Sun's approach to software integration and pricing would be more cost-effective than rival technology from IBM and Microsoft, he added.