Sun has decided not to proceed with a low-end, entry-level storage project that Dot Hill was working on. Instead, according to Dot Hill, it is awarding the project to another party. That sounds like Engenio or Xyratex. Paul Giroux, VP and GM of Sun's Disk Business Unit, said: "Dot Hill remains a strategic partner of Sun Microsystems and we look forward to working together on the existing products and potentially other initiatives in the future.". Existing products include the Sun StorEdge 3000 disk array product family.

Dot Hill mentioned this thought in a previous release: "Sun's next generation offering will provide customers with an entry-level price-point solution while incorporating emerging storage technologies. Key applications that are prime targets for Sun's next generation offering include: Grid computing, web and e-commerce, education, retail, manufacturing and service providers."

Sun is, it appears, Dot Hill's biggest customer. The project re-award will be a blow and the reasons for it could be interesting. Dot Hill will say more in a May 9th conference call.