2003 International Technology Conference “Emerging Wireless Applications” Hong Kong, January 2003

1. 2003 International Technology Conference “Emerging Wireless Applications” Hong Kong, January 2003 Stefan Rust Director, Strategic & Venture Investments Corporate Strategy and Development Sun Microsystems, Inc.

2. End-to-End, Javacard -> J2EE Integrated & “Integrate-able” NetworkComputing Partners Leverage Open Source Scale Open public API’s Focus: no printers, cameras ...

3. Network Computing with competitive advantagethrough ... with competitive advantagethrough ... to deliver industry-leading network computing solutions ... to deliver industry-leading network computing solutions ... to deliver industry-leading network computing solutions ... Infrastructure solution practices ... Infrastructure solution practices ... Mobility Web Services Mobility withsecurity Mobility withsecurity Community Self Service Edge Java & XML for proven, open Web services Digitization Storage Storage Cost,utilization,simplicity Datacenter Datacenter Solaris Solaris x86 Linux

4. Global Economy woes IntensifiedCompetitivePressure GlobalPoliticalTension Current Environment

5. Harnessing Disruptive Innovation So You Win!

6. Innovate! Drivers and Enablers of Innovation at Sun Competitive Passion Resources Organization Structure EncourageRisk Taking Rewards and Recognition Focus

7. New Technologies from Sun Examples of Disruptors that Work for You • Linux Desktop • Sun ONE Network Identity Offerings • Solaris, App Server and Directory bundling • Open source

8. Market Dynamics and the Wireless Industry

9. Market Dynamic – Marketplace There are only three network outlets, and consumers are driving demand. Fixed Line Cable/Set-Top Box Wireless

10. Market Dynamic – Wireless • Services and Devices are converging • Voice and Data, Cable TV/Broadband • Camera/cellphone, Cellphone/PDA/Laptop • MP3/Gameboy advance • Price of components are declining • Semiconductors • Displays • Flash memory • Bandwidth is increasing • Suitable Chips using less power • Open Design • Proliferation of Technologies • 802.11 / Bluetooth / EDGE

11. The Drivers of Internet Demand WORLDWIDE FORECAST Millions 2,000 Wireless Devices Wireline/PC Cable Set Top 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 2000 2001 2002 2003 2004 2005 Source: IDC, June and Sept. 2001; ARC Group, Oct. 2001

12. Wireless will grow Millions of Users $ARPU/Month $80 2,000 $80 Mobile Subscribers Java Handsets $ARPU 1,800 1,600 $66 $70 1,400 $56 1,200 $60 $52 1,000 $47 800 $50 $45 600 400 $40 200 0 $30 2001 2002 2003 2004 2005 2006 Source: ARC Group, Oct. 2001

13. Asian Market Environment • Development of software houses • Asian’s refuse to pay full $$ for software • wireless gaming is different as it does not depend on the consumers for direct revenue • New business model for software houses • licensing fee from handset manufacturers for embedded games • Mobile networks every time someone plays one of their games • Open Network Access Regime • 3G license holders to make 30% of their network capacity available to MVNO’s • MVNO’s own switching gateway, subscriber database and roaming agreements • Impact to Mobile Carriers • reduced customer churn, higher revenue, higher margins

14. Importance of the “business model”

15. Thesis: We don't have the machinery to charge for them i.e., neither subscriptions nor advertising Why hasn't this happened? Ubiquitous 802.11b

16. “Cool” emerging wireless technologies with potential

17. Wireless Investments • Services platform for the delivery of executable content (Mobilitec) • Interactive gaming platform (Jamdat Mobile) • Software Infrastructure with extensive distribution network (Migasia) • Location services platform (Kivera) • Platform for delivering multimedia content, MPEG-4 (Packet Video) • Mobile Broadcasting Services (MBC)

18. “Cool” Emerging mobile Technologies • 1. On-Field Live Football from Sorrent (www.sorrent.com): Sorrent promises something better. A football game the company is launching with Fox Sports has good color on next-generation phones, features multi-player action, and might be as much fun as Snake -- if the wireless carriers who will offer the game don't get too greedy. The single-player version is due in mid-October and the multi-player version in mid-November. Sorrent expects wireless carriers to charge $5 to download the game, a flat rate of $3 a month to access the online version, and on top of that, a per-minute charge to compete with other opponents wirelessly. • 2. Oyster from Tcom International (www.sherpaq.com): Put your laptop into this dock, and it operates like a desktop. The Oyster allows you to sit your laptop up vertically on the desk, with the keyboard and screen facing you. thisuniversal laptop dock feeds the power and peripheral cords into a well in the back. A wireless keyboard in the front allows you to use it the way you would a desktop computer. • 3. SONbuddy from Green Packet (www.greenpacket.com): This software allows users to create a personal wireless network, to, say, take a laptop equipped with 802.11b and reach out and grab other 802.11b users who want to connect. It's also built to work with 802.11a and g, though those are not yet widely used.

19. “Cool” Emerging mobile Technologies • 4. SkyCode from SkyGo (www.skygo.com): It's mobile marketing, except the type you want to receive. The idea behind SkyCode is that you see a phone number on a billboard or TV commercial, dial it into your phone, and start getting deals. For example, a Connecticut TV station used SkyCode to let users play a game, and enter to win a trip to the Tennis Hall of Fame. Companies could use the technology to deliver coupons, incentives or loyalty rewards. • 5. Modtones Polyphonic Ringtones from Faith West (www.faith-inc.com): This company's technology makes it possible for cell phone tones to sound more like instruments. For those who love to change ringer melodies to suit their mood, this is great news. There are real benefits to Faith West's efforts in ringer technology. The company is working on ways to let people record their own ringer tones, say, voices. It might even be possible in a year or so for one person to ``push'' a ring tone to someone else, perhaps ``Hey, it's Jon. Answer the phone!'' 6. Mobile Music Engine from Shazam Entertainment (www.shazam.com): Hold a cell phone up to a tune, and a text message tells you the song title and artist. This technology is just plain clever, and it's locally grown. Two scientists at Stanford University invented the underlying technology. IDial 2580, and play 30 seconds of a song into the phone by holding it near the speaker of a radio or stereo, and the carrier sends you a text message with the name of the song and artist.

20. “Cool” Emerging mobile Technologies 7. Keyboard Perception Chipset from Canesta (www.canesta.com): Canesta's keyboard made of light. When you turn it on, it forms a keyboard that looks like the laser trip-wires out of spy movies -- except when you touch one of the laser-generated keys, instead of setting off an alarm, it enters a character into a device. Canesta intends for the keyboard to be used with handheld computers and cell phones, mobile devices that are too small to incorporate full-size keyboards. • 8. Zoominator from Geophoenix (www.geophoenix.com): The small screens on mobile devices can make information difficult to read, especially tightly packed databases. The Geophoenix Zoominator allows Internet content providers to assemble their content is such a way that users will later be able to zoom in on portions, making it readable. • 9. FileMaker Mobile (www.filemaker.com): This little-watched subsidiary of Apple Computer is doing some great things with the next-generation Internet. From within FileMaker Pro 6, you can call out over the Internet to Amazon.com's book database, which Amazon makes publicly available as an XML Web service. With the help of third-party software, FileMaker Pro 6 pulled in title, author and pricing data, and arranged it in usable database fields. Next, you take the database and synced it over to a PDA, running FileMaker Mobile 2. If we were in a bookstore, we could use the PDA and a barcode reader to check inventory against the existing database. The exciting thing about the combination of FileMaker Pro 6, FileMaker Mobile 2 and XML, is the potential for individuals or small businesses to carry and update complex databases, using the Internet.

21. Stefan.rust@sun.com Thank You Questions?