I blogged last week about the potential impact of expensive energy on the future shape of the internet. Now it turns out that Sun has already started changing the design of its computer systems to favour efficiency rather than performance because of energy costs. It seems to have moved them to a different market space from their competitors.

In an interview in Guardian Technology, Chief Executive Jonathan Schwartz explains the history, which seems to have led to a strongly differentiated product:

“Four or five years ago we began to reinvent SPARC [the architecture of Sun’s processors]. We spoke to search companies all over the world, online media companies, telecommunication companies, even a variety of financial services companies. We heard that they were out of space. We heard that electricity was becoming a dominant driver of expense in their data centres. So we recrafted our platform around that feedback.”

The new processor was code-named Niagara.

It was 32 times more efficient than any other computer in the marketplace, but at doing 32 things simultaneously. At doing one thing, it was a tenth as fast. In essence we delivered a greyhound bus into the marketplace for mass transit, when all of our peers were delivering Ferraris. That’s now a billion-dollar product.”

Much of the article is about Sun’s position as the developer and distributor of the open source office software OpenOffice, which it gives away. (It becomes a marketing tool for Sun’s hardware products and service/support.) And in the same article, Sun’s Chief Technology Officer, Greg Papadopolous, says that one of the problems with the proprietary software is that it’s “a kind of a drug”.

Companies that are proprietary can charge what they want to for their software. Why? It’s because the switching costs to move off one piece of software to another is very high. So what you are able to do as a proprietary company is to raise your prices just below what the pain is for the customer to switch across.

“When you go into this open-source model you are giving up the potential to inflict that much pain on people. And you are giving up potential profit-making. But the exchange that you make is that you get this outrageous distribution channel. I’m getting thousands of people a day to take my stuff and I don’t have to pay them to take it, they’re doing it, and creating future business opportunities.”

Update (2 March 08): John Naughton picks up the energy theme in an article on the prospects for “cloud computing” (he’s pessimistic, by the way):

Some companies are already aware of the looming environmental issues. Google’s senior executives are reportedly obsessed with their company’s power consumption. And last week IBM launched a new mainframe which provides the computing power of 1,500 PC-based servers but with 85 per cent lower energy costs. Perhaps this is a token of what’s to come: the mainframe is dead; long live the mainframe!