Sun Will Not Increase Java License Fees Even As Device Demand Jumps

Sun Microsystems will not increase the small license fees it charges for its Internet-friendly Java software in a bid to make it profitable even as demand for Java-ready mobile devices takes off, the company said Tuesday.

"Why would I tax the people that propelled [Java]?'" says Patricia Sueltz, Sun's executive vice president who heads the software division.

Sueltz says Sun will not increase its small license fees on Java products in order to make the software independently profitable.

Java is catching on in some mobile devices, although Sun rival Microsoft is developing a competing platform soon. The software allows cell phones to access a wide range of interactive content from the mobile Internet that offers information and services to users anywhere.

Sun says it makes money from selling systems, and to an extent services, rather than software, although it has reduced its financial outlook three times this year, citing economic weakness. The company's strategy remains to encourage Java development that could spur sales of Sun systems.

Sun is focusing on making its software easier to expand for heavier loads that could be demanded as the Internet grows, to work uninterrupted in real time and to more closely integrate with other systems, Sueltz says.

Some analysts have said software investment would be a candidate for cost cuts at Sun. But Sueltz says nothing major is in store.

"I think we have the right strategy," she says. "I'm not cutting back currently."

Research and development is still crucial, she says.

"When you've had a shift in the market like we've seen, it is a healthy weaning time and culling time, but we remain committed to putting in 10 percent of revenue," Sueltz says.

In a sign of the software's growing success, Pekka Ala-Pietila, the CEO of No. 1 cell phone maker Nokia, told the JavaOne developer conference on Tuesday that Nokia will produce 50 million Java-ready mobile devices next year and 100 million in 2003.

"I think those numbers are big numbers," Ala-Pietila says. "And so is the opportunity, and so is the business."

Motorola has brought out Java phones in the United States, and Sun says Java phones are selling at the rate of 60,000 per day in Japan since their introduction a couple of months ago. Later this month, Japan Telecom is due to launch Java-ready phones to increase its share in Japan's mobile phone market.

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