Hughes, Sun win AF buy

The stage is set for fierce competition in the federal workstation arena with the dual award of contracts to Hughes Data Systems and Sun Microsystems Inc. under the $956 million Air Force Workstations I program.

Workstations I will supply up to 37,000 portable and desktop Unix systems. Sun is offering its SPARCstation 20, a familiar platform in Defense Department command and control. Hughes is providing Digital Equipment Corp.'s Alpha-based systems, the leading 64-bit product line.

The Air Force program, one of the largest government contracts for Unix workstations, gives both vendors a chance to capture a larger share of a stagnant market, said Jan Morgan, research analyst with IDC's Government Market Services.

"Everything is replacements when it comes to workstations," Morgan said. "We don't see any major growth on the horizon."

Sun and Hughes will be vying for business in command and control, scientific and engineering applications, and logistics. The program also has a 20 percent set-aside for civilian agencies. Each contractor must provide four classes of workstations: portable, entry, mid range and high-end.

Unsuccessful bidders are believed to include Electronic Data Systems Corp., teamed with Silicon Graphics Inc., and Sylvest Management Systems Corp., teamed with Hewlett-Packard Co., according to Federal Sources Inc., McLean, Va.

Workstations I represents significant milestones for both of the winning vendors.

The program gives Digital its largest and most important vehicle for its 64-bit Alpha systems. Top-level executives at Digital had identified Workstations I as one of its "must wins." The Navy's Tactical Advanced Computer-4 program, which Digital bid unsuccessfully, was another. HP won that contract.

With Digital pursuing a number of other DOD contracts, the Workstations I program "could set the tone in the customer's mind of the importance of 64-bit computing," said Ed Loughman, the Air Force program manager for Digital's Federal Government Region. This contract "could be a cornerstone program for Digital's federal operations," Loughman said.

Digital first introduced its Alpha product line four years ago and has been slowly making inroads into the federal market. Its customer base includes DOD and civilian intelligence communities, NASA and other high-performance-oriented users. Digital holds one of NASA's Scientific and Engineering Workstation Procurement contracts.

More than just an opening at the Air Force, Digital believes the new contract offers a good opportunity for selling outside DOD, where Sun is not as strong, Loughman said. "The Alcor systems at the high end are industry leaders and will provide us with sales momentum in the civilian agencies."

Win Boosts C2 for Sun

For Sun, Air Force Workstations I "cements our dominant position in command and control," said John Leahy, group manager at Sun Microsystems Federal Inc., Vienna, Va.

Last year Sun teamed with GTE to win the Army's Common Hardware/Software-II contract. The company's workstations are already being used in DOD's Global Command and Control System environment.

But the Air Force contract gives Sun a much broader potential customer base than its previous contracts, Leahy said. "We have the opportunity to sell these systems in virtually every Air Force operation," he said. "This is the first time we have won a contract that covers that scope."

Sun intends to keep its contract up to date with its latest technology offerings throughout the five-year buying period, Leahy said. In the near term, the company plans to add systems based on its 64-bit UltraSPARC processors.

Hughes and Digital believe their team has an edge because they are offering 64-bit technology, including the operating system, from the contract's outset.

The major Unix vendors will be rolling out their 64-bit systems over the next couple years, but Digital's technology is already mature, said Gary Ziegler, program manager for Workstations I at Hughes. "They are approaching four years of experience, and that was important to us," Ziegler said.

Hughes had bid against Digital on TAC-4, and "we learned from that competition they have a very good product line," he said.

Hughes does not expect most Air Force customers to be daunted by the prospect of moving to 64-bit systems. As part of its bid process, the company converted nearly 500,000 lines of code from the Sun platform to the Digital Alpha platform, Ziegler said. The process only took a matter of weeks, and the software showed "great performance," he said.

Workstations I might become a barometer for the workstation market, IDC's Morgan said. "If Digital manages to push more boxes [than Sun], it could really force the other vendors to speed up [their 64-bit development]," she said.

Workstations I will be a very competitive environment, said Bob Dornan, senior vice president of Federal Sources Inc. Sun has experience selling off such large workstation contracts as the Navy's TAC-2.

But Digital, which really needed this win after losing TAC-4, has the determination, Dornan said. "I've got to assume they are going to do everything they can to make this a successful vehicle."