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Sun sees economy getting better, but still doubtful

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CIOL Bureau
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SUNNYVALE, Calif.: Network computer maker Sun Microsystems, Inc. has seen

signs that the economy is stabilizing but it is too early to call a recovery,

Sun's chief operating officer Ed Zander said on Friday. "I think things are

somewhat stable," Zander said in an interview on the sidelines of an event

to launch a new Sun research facility. "It's getting a little bit better,

not much."

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Sun had previously said that orders in October were stronger than where they

had been at the same point in the quarter earlier, but Zander said the company

had not closed the books on November and remained wary of the month ahead.

"The predictability of October was better than it was in the past,"

Zander said, but added, "I think all of us for the last nine months have

been proven wrong and we are very cautious... You don't know what December is

going to bring."

Sun, which will give a mid-quarter update on business on Thursday, has said

it is not losing market share to competitors like IBM, but a number of its

customers have closed or gone bankrupt, resulting in a decline in overall

business. "When you have an Enron, it sets things back a bit," said

Zander. "It's not like we are losing business to competitors. We are losing

customers."

Bankruptcies and business closures not only decrease demand for Sun's

networking equipment but also mean more equipment is sold off on the secondary

market, analysts have said. Energy trading firm Enron Corp., which once ranked

as one of the top 10 US corporations, axed workers at its European unit on

Friday, as employees elsewhere awaited their fates ahead of an expected

bankruptcy filing by the US parent company.

Out of the 5,000 people employed in Europe, Enron Europe retained about 250

staff members to help wind down the business, sources said.

(C) Reuters Limited

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