NEW YORK (Business 2.0) - Right after Google held a joint press conference with Sun earlier this week, the blogosphere was buzzing -- with disdain. On his blog, my colleague Om Malik dismissed the announcement as a "cheap publicity ploy."

You can hardly blame him, since the deal was short on substance. Bundling the Google Toolbar with Java downloads is hardly earthshaking stuff.

But if you watched the video replay of the conference, you'd see something interesting: Sun (Research) co-founder Andy Bechtolsheim handing Google CEO Eric Schmidt one of the new Sun Fire servers that Schmidt himself helped design. Google (Research) spokeswoman Lynn Fox confirmed that the agreement includes a commitment by Google to buy Sun hardware.

Though both companies remain mum on exactly what hardware Google will purchase, it doesn't take a genius to conclude that Google must be interested in Sun's newest servers. Bechtolsheim was Google's first investor, so he's familiar with the search engine's growing computing needs, and Schmidt was Sun's former chief technology officer, so he actually helped build the server and is quite familiar with its capabilities.

In Google's early days, company co-founders Larry Page and Sergey Brin hand-built their servers from off-the-shelf parts, an approach that saved them money but is apparently proving difficult to scale, especially as Google adds new features like serving up online video.

At the press conference, Schmidt revealed that Google has already been buying servers from Sun. The company probably will continue to build strategic partnerships with key vendors like Sun to keep costs low, especially as its computational demands continue to grow.

So why would Google choose to invest specifically in the Sun Fire line? The newest models, the Sun Fire x4100 and x4200, are designed exactly for the type of computing capabilities Google needs. Also, Sun's servers are built to stay cool and sit on top of each other in sprawling data centers -- exactly the kind of computing environment Google uses.

The servers are made with chips from Advanced Micro Devices (Research) that can run the same software as servers with Intel (Research) chips -- such as Linux, Microsoft (Research) Windows, and Sun's Solaris operating system. At $2,500 and up, the Sun Fire servers aren't the cheapest you can find, but for the price, they pack a lot of performance and features that can't be found on other rack servers, such as more network connections and faster processors.

When you squeeze an extremely high-powered computer into a case designed to fit in a rack (about the size of a pizza box), there are different demands to account for than with a stand-alone desktop computer. It's well documented that minimizing heat production and power consumption are the biggest problems with rack servers.

By adapting tricks it has learned from a decade of making 64-bit servers using its own Sparc chips, Sun has pulled off some technical feats that Dell (Research), Hewlett-Packard (Research), and IBM have yet to match. The x4100, for example, manages 50 percent more performance, according to Sun, while consuming a third of the power and a quarter of the space of a comparable Dell server. It does this primarily by using the latest dual-core chips from AMD, while Dell uses less-efficient single-core chips from Intel.

This means that if Google uses Sun's servers, it can pack more powerful computers into a smaller amount of space and they will process data more quickly than they could using similar servers on the market.

Few companies have computing demands on the scale of Google's, of course. But space in data centers is getting tight across the United States, according to commercial real estate brokerage CB Richard Ellis, which helps locate available data centers for its customers. Also, electricity prices could spike this winter, making power consumption even more of a concern than it already is.

There's nothing stopping Dell, HP, and IBM from getting their hands on the same chips from AMD and eventually coming out with similar systems, but for now Sun has a bit of a lead over the rest of the industry. And it also has a marquee customer in Google. We know that Schmidt has his hands on at least one Sun Fire server. It likely won't be the last.

_____________________

Sign up to receive the Tech Investor column by e-mail.

Plus, see more tech commentary and get the latest tech news.