GE Security Inks OEM Agreement for Sun Middleware Stack

Published: April 27, 2006

by Timothy Prickett Morgan

Sun Microsystems has not only been able to convince General Electric to become its largest user of the Java Enterprise System middleware stack. Last year, GE inked a deal to use Sun's Identity Management Suite, a subset of the Java Enterprise System, across 450,000 end users in 11 different GE operating businesses. This represents about 40 percent of the current subscriber base of the JES stack, which had an installed base of 1.12 million seats as of the end of March.

Now, GE has done one better, and is now going to become an OEM of the Identity Management Suite, and will be embedding it into products created by its GE Security division. GE plans to create a security server appliance that is based on Solaris 10, JES, and Java-based smart card technology. This appliance will converge the computer systems security and building access systems into one single appliance. GE says that currently, building access and computer systems often allow employees to use a single smart card, but companies and organizations often have to deploy two separate servers to manage computer access and building access. GE plans to make a single security server that can handle both ends of the security.

What effect this will have on the JES installed base remains to be seen. But if GE deploys JES at thousands of companies with potentially hundred to tens of thousands of employees, the JES seat count could go way, way up. The question is how much recurring revenue Sun will get from GE's sales of the JES software. The JES suites cost $50 per employee per year, while the full JES stack costs $140 per seat per year. Scott McNealy is on the board of directors at GE, and this is clearly one of the key reasons GE was an early and big adopter of the JES software and probably how this OEM deal came about, too. But it is hard to imagine GE didn't get a deal from Sun, no matter how much the latter needs the money. Sun needs the PR and the endorsement of the JES stack more.