Brainless NCs Are Looking Smarter Now
Like the new kid in school, network computers got a mixed reception at the Comdex trade show last year.
Bill Gates and other industry big shots picked on the funny-looking newcomer, snickering at its scrawny build and absent hard drive. But others, such as Oracle Corp. Chief Executive Lawrence Ellison, championed the NC as a computing device for the masses.
A year later, the novelty may be wearing off for the NC, a stripped-down computer designed to access data and software over the Internet. But interest in the devices is building as companies seek ways to reduce the spiraling costs of managing networks of PCs.
Federal Express Corp., long an information technology leader, is now a believer. The company announced plans to purchase as many as 75,000 of the devices over the next few years, the first corporate giant to make such a commitment.
IBM Corp.’s Lotus division just unveiled a new business software package tailor-made for network computers, filling a gap that troubled many potential customers.
And the biggest backers of the network computer--IBM, Sun Microsystems Inc. and Oracle, all of which view the NC as a means of chipping away at Microsoft’s Windows monopoly--plan to ramp up production of network computers next year.
The NC has a long way in challenging the resilient PC, whose prices have come down so rapidly over the last year that many models are now cheaper than network computers, which cost $600 to $1,000 without monitors. Microsoft Corp. is moving quickly to head off the budding NC market with its own breed of simplified software and terminals.
Dataquest Inc., a San Jose-based research firm, predicts that as many as 2.5 million network computers will be sold in 2000, up from a few hundred thousand this year. But that barely qualifies as a dent in the PC market, expected to total 130 million units in 2000.
“Over the next five years, we expect the NC to have little or no bearing on the PC market at all,” said Kimball Brown, an analyst at Dataquest.
Network computers have a screen and a microprocessor, but no hard drive, and use the Internet as their repository for software and information. In theory, they provide all the computing power most people need at a lower cost than a PC and with fewer headaches.
Most analysts agree it will be years before NCs make their way into the home, though a variant of the NC--set-top TV boxes for Internet surfing--is increasingly popular.
But NCs already have a big appeal to businesses and government agencies frustrated with the complexities and costs of maintaining vast networks of personal computers.
Contra Costa County in the San Francisco Bay Area, for instance, bought 25 NCs earlier this year from IBM and plans to buy as many as 700 more for the county’s court system and welfare department.
The machines weren’t much cheaper than PCs to buy but are far cheaper to manage, said John Forberg, deputy director of information technology for the county.
The reason is simple. Employees using NCs share the same piece of software stored on a single server--a high-performance computer. To upgrade the software, the county has to make changes on only one machine.
NCs have other advantages. Employees don’t have to back up their files and can move from one station to another while still having access to their own data and software setup. Because NCs don’t have hard drives, employees can’t tinker with them (read: break them). And companies inclined to Big Brotherism can better monitor what employees do with PCs.
A recent study by Gartner Group calculated that personal computers typically cost $8,000 a year to maintain and that NCs can trim that cost by as much as 40%.
