Sun is following through on its strategy of building systems for service providers in the new world of web2.0, SaaS and communications over IP- a trend CTO Greg has called Red Shift (see video Redshift: The Explosion of Massive-Scale Systems 
by Greg where he walks you through this shift.)
Jonathan Schwarz has argued in several of his blog posts (including The Glamor in Mass Transit) that service providers need systems that are brutally efficient and scale to deliver these new services.
…datacenters are increasingly pining for high performance buses – infrastructure optimized for utilization, efficiency, and overall performance, not just simple component speed.
It today launched Sun Streaming Video system that provides 10x the capacity of existing platforms at 1/2 the cost, claims Sun.
Designed by Sun co-founder Andy Bechtolsheim, Sun’s cutting-edge systemdesign enables the Sun Streaming System to support up to 160,000 simultaneous, unique video streams at the rate of 2Mbps and a price of less than $50 per stream for complete video headend — which is approximately 10 times the streaming capacity of competitive platforms. Thirty-two integrated 10 Gigabit Ethernet optical networking ports combine multiplexing, switching and routing all in one high-density video streaming package.
Sun did not report a good quarter yesterday, loosing 10% of its stock value in one day. However, if it is able to execute on its RedShift project- the future may look sunnier.