I don't know the details, but integrated software and hardware can give performance benefits not possible with modular architecture. eg. iPhone, consoles vs. PC with comparable CPU/GPU. Of course, a more appropriate comparison is with what IBM does.

Perhaps we can expect some proprietary extensions to java that will scream on that particular Sparc? Of course, that ruins Sun's dream... but the dreamer is no more. Or, closer to home for Oracle, that its database screams on it... Where they use this integration trick really depends on where they feel a little extra performance would beat the competition.