NCR Corp. said it will include software developed by Sun Microsystems Inc. in the next generation of computers that it builds.
NCR's bank customers will then have a choice of operating systems-Sun's Solaris or Microsoft Corp.'s Windows NT-on computers from NCR.
Perhaps more important for the many financial institutions that are drawn to Sun's technology, the alliance would make it easier to use NCR's extensive data warehouses.
"I think we're in a very good position right now," said Bill Eisenman, senior vice president of NCR's computer systems group. "We're able to offer the two most popular operating systems on our platform."
With 31% of the market, Sun's Solaris is the leading variant of the Unix operating system, the open standard that is widely employed in large-scale, transaction-intensive computing operations in the financial industry.
The alliance with NCR helps Sun and its SunSoft subsidiary consolidate their leadership role in the Unix world.
One concern for banking customers is the ability to mine the extensive data warehouses NCR has built for clients, including Bank of America, Chase Manhattan, First American, and Providian Financial Services. Normally, these are built by stringing together large numbers of processors - 768 Intel Pentium Pro chips in the case of Walt-Mart Stores' warehouse.
From Sun's perspective, the alliance with NCR is a victory in its high- stakes battle with Microsoft.
As a major builder of Unix-based hardware as well, Sun Micro systems has been touting its Solaris platforms as an alternative to Windows NT.
"Fundamentally this world is just kind of down to a Coke versus Pepsi, Hertz versus Avis, Holyfield versus Tyson kind of thing," said Sun chief executive officer Scott McNealy during the announcement of the NCR alliance.
"And we're very happy to be in the ring and having our ear bit on a little bit," Mr. McNealy said.
As Sun and Microsoft battle it out, hardware vendors like NCR are content to play on either side.
Running both Windows NT and Sun's Solaris on its WorldMark computers, NCR will use Intel Corp.'s microprocessors, including the powerful 64-bit chips that are due out in 1999.
"The market will grind this out over a period of time," said NCR's Mr. Eisenman. "I think it's very important that we allow our customers to make their choices based on the needs of the specific problems that they're trying to solve."
Although NCR has offered its customers the choice of using Intel 32-bit processors with Windows NT or its own version of Unix, data warehousing functions often require more computing power.
"The most memory that a 32-bit system can scan at once is four gigabytes," said Jean Bozman, an International Data Corp. software analyst based in Mountain View, Calif. "A 64-bit system can scan more than a terabyte," or 1,000 gigabytes. "For companies like NCR with large data warehouses, it makes a lot of sense to use 64-bit systems."
"Sun software is already in use by many banks," said David Rocci, NCR's marketing director for financial services. "Now customers who want to use NCR's data warehouse capabilities no longer need to switch."
Analysts viewed the alliance as a win for both companies.
"NCR made a bold and intelligent move," said Jon Oltsik, senior analyst at Forrester Research in Cambridge, Mass.
"It doesn't have to invest in its own proprietary Unix, and it gets some instant Internet credibility" by hooking up with Sun, which has tied many of its strategies to the World Wide Web and emerging electronic commerce capabilities. As a major supplier to engineering and academic users, Sun became the leading infrastructure technology provider for the Internet.
In NCR, "Sun gets a visible partner for putting Solaris on Intel," Mr. Oltsik said. "They are making IBM and Hewlett-Packard look like small players."
