Trudy Norris, the president of Sun Microsystems UK, has some advice for how to stay afloat in IT: “watch the kids.”

It may seem like strange counsel given that Sun manufacturers giant computer servers, but with the entire computing industry increasingly focused on serving the needs of an internet-based audience, all companies, not just the Flicks or the Bebos, have to focus on understanding the whim of ‘experts’ within that audience, experts like her 15-year-old son.

“It could be anything — MySpace, Second Life, or this new Twitter thing,” the 47-year old says, referring to the new micro-blogging site which asks its users to ‘tell the world what they are doing.’

“Whereas before the device had the processing power, now that power is being located at the back end — with the server.”

“Any of the services driving the media industry now — be it Virgin streaming content or Sky storing it, are predominantly server-based.”

In many ways it’s ironic that Norris, who came to the British helm of Sun two and a half years ago, enthuses so heavily about the internet: in her own words, it was the net — or at least the dot-com industry — that precipitated the company’s woes in the past couple of years.

The most recent fiscal quarter — when it posted net income of $67 million, was only Sun’s second in profit after a long stretch of poor earnings, the principal cause of which, she says, was the failure to correct an ill-fated costing model in the wake of the tech stock boom.

“At that time of the boom our revenues were inflated and when they came down, our cost model couldn’t serve them. We’d based our costs on sales of 20 million, say, when the estimation should have been more like 12 million.”

The company was also carrying a lot of fat. In November last year, Jonathan Schwartz - formally the chief operating officer - took over as chief executive from Scott McNealy, who’d headed the company for 22 years, and a campaign of rigorous cost-cutting was begun.

Five thousand workers, largely middle management, were laid off world-wide, the UK’s 2,000-strong workforce “playing its role” in the cull, Norris says; the company’s offices in Bagshott, Bracknell and Wokingham were closed down in favour of a centralised operation in the Thames Valley; and relations with suppliers were tightened.

There’s also been a significant push to reduce electricity consumption — “our third biggest cost behind staff and property.” All the company’s desktops have been replaced by ‘thin line’ clients — essentially monitors without processing power – which reportedly cut running costs by 95 per cent.

Asked whether the changes — which appear to reversing quarterly losses of more than $200 million only a year ago — were down to McNealy not having been tough enough, Norris says: “Scott was always pushing for the industry to catch up with his idea that the network is the computer, but the catch up took a few years longer than he had hoped.”

“He was also a paternalistic guy and didn’t want to let anyone go. There was a sense with him that Sun was a big family.”

Sun’s core business is also changing. While it continues to sell corporate servers, an increasing percentage of the company’s revenues derives from the services associated with products like internet television, as well as from new avenues such as storage.

“It’s not just about the box anymore. Customers want to know about ‘uptime’ — whether you can deliver the service constantly. Sun is still a manufacturer par excellence but it’s not as important as was,” she says.

The company is also devoting significant resources — 16 per cent of revenues, Norris says — to R&D, recently announcing it had developed a server that will enable 160,000 unique videos to be streamed simultaneously, at a speed of 2Mb per second.

“It’s a leap forward; no-one’s been able to provide internet television like this before,” she says, adding — in that both the BBC and ITV announced their video on demand strategies — that the company was in talks with several major UK broadcasters about buying it.

Norris, who began life as an accountant and spent time as a manager at both Kodak and Oracle before making the leap to Sun, has long been feted as one of the few women to climb to the top in Silicon Valley.

From where does the daugher of a coal-mining family from Swansea, who has three kids of her own — 15,14, and 10 — get her strength?

“I was the seventh of eight kids, which meant I was always fighting for space. That’s going to give you drive, I guess.”

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