PCs and Thin Clients Converging Fast
MicrosoftCorp. once called its thin-client strategy Hydra. This seems apt as thinclients can sometimes be a monster of a problem. As major PC OEMs churn outslimmer PCs, the line between conventional personal computers and newfangledthin clients becomes more fuzzy. Are PCs and thin clients converging into asingle, homogeneous computing type? Will one displace the other? Or will bothcoexist with one another and complement one another in the same environments?
In 1996,Oracle Corp.'s (www.oracle.com) CEO LarryEllison trumpeted the concept of a network computer (NC), a thin-client devicethat would feature an embedded operating system and offer limited functionalityfor task-based workers.
Because theNC had no floppy drive and no internal hard disk drive -- and because itaccessed applications and manipulated data that resided on a beefy server host-- it was said to eliminate most of the distributed management problemsassociated PCs.
Microsoft (www.microsoft.com), of course, pooh-poohedthe idea of the NC. Not only was the NC’s reason for being -- the displacementof the desktop PC paradigm -- anathema to the lucrative licensing schemes thatpropelled Microsoft’s ascent to dominance and to soaring stock prices, but theNC also threatened the growth of the software giant’s still immature Windows NToperating system. In 1996 NT simply wasn’t robust and scalable enough to be aserver hosting environment for the thousands of NCs that Ellison had in mind.
In early1997, Microsoft and Intel Corp. (www.intel.com)struck back with the first in a series of planned NC-killers: the managed or“Net” PC (NetPC). Because it featured manageability enhancements such as achassis alarm and wake on LAN (WOL) functionality and retained the local harddisk and most of the other features of the conventional PC -- minus the floppydisk drive -- the NetPC was touted as a more manageable alternative to the NC.No one bought it. After IBM Corp. (www.ibm.com)jumped the NetPC ship in September 1997, it died a quiet death.
After,Microsoft formed a deal with multiuser-for-Windows NT specialist Citrix SystemsInc. (www.citrix.com) for the rights toits multiuser extensions to the Windows NT kernel. Microsoft and Intel thentook the wraps off of their most effective NC-killer: the Windows-basedterminal (WBT). WBTs were slated to run either Microsoft’s embedded Windows CEor embedded Windows NT operating systems. They would run Windows applicationshosted on the server side by a new version of Windows NT 4.0 Server, dubbedWindows Terminal Server.
Through itall, the PC absorbed the best of both worlds. It became more manageable withthe incorporation of WOL functionality. With the success of Intel’sWired-for-Management initiative, it became slimmer as vendors stripped away fatand began shipping PCs that were thin client computers in all but name.
Industryopinion about thin-clients is also undergoing a major transformation. Two yearsago, IDC (www.idc.com) concluded that justover 500,000 thin clients were purchased, and indicated that the bulk of themwere WBTs.
It nowappears that the market is warming up to thin clients. According to IDC, thinclient shipments increased by 90 percent in 1999. Moreover, more than 75percent of respondents to a recent IDC survey acknowledged that they believedthin clients to be an acceptable alternative for some PC users. Finally,greater than 50 percent of survey respondents disclosed that they had replacedsome PCs with thin clients.
In theearly days of the thin client-NC revolution, most vendors touted the perceivedlower total cost of ownership (TCO) of such devices as the strongest sellingpoint. In addition to a cheaper initial cost -- which was often one-third oreven one-quarter that of the PC -- thin clients were said to present far lessof an overall management cost: about $3,000 per year each for thin clientsversus almost $6,000 per year each for PCs.
But IDCsays neither the transformation in thinking about thin clients nor the recentgrowth in acceptance of thin clients were directly related to TCO issues. BruceStephens, vice president, worldwide personal systems research group, at IDC, indicatesthat most companies were purchasing thin clients because of their perceivedreliability advantages.
"Endusers expect thin clients to be reliable, easy to use, and good performers,” hesays. “In addition, they should allow access to Windows applications, be costeffective, easy to install, and secure.”
Stephensfound that TCO didn’t rank among the top three concerns of most surveyrespondents: After reliability, most respondents indicated ease of use,followed by client performance.
RobEnderle, senior analyst at Giga Information Group Inc. (www.gigaweb.com), says such a transformation may be takingplace because PCs and thin clients are increasingly deployed less asreplacements for one another, but more often as complements of one another.
“They bothhave their uses, and people are waking up to that,” he observes. “Windows 2000makes the PC a lot more manageable on the desktop, and a lot of users needtheir PCs. But in other cases thin clients aren’t such a bad choice, and you’llfind more people seeing it that way.”
While thegrowth in thin client acceptance is impressive, even the most bullish of thinclient supporters doesn’t expect the PC to disappear -- or even be reduced tothe status of a niche product.
“Certainly,applications for thin clients will continue to open up, but there will probablyalways be a need for PCs,” Enderle says. "Thin clients are acceptable andeven ideal for task workers and others, but they’re not global replacements forPCs, and they’re not ideal for power users.”
HowieHunger, director of thin client computing at IBM, says it’s unrealistic tothink that PCs will be completely or even largely replaced by thin clients.
“Honestly,I don’t think that [PCs will] be slimmed out of existence, and that’s comingfrom a person who lives and breathes thin clients,” Hunger says. “When we talkto customers, we discuss with them that there are different users and differentapplication needs that dictate the use of different types of devices.”
Big Bluemarkets and sells both thin client appliance-type devices and full-fledged PCsunder its NetVista brand. IBM has aggressively supported its NetVista thinclients, slashing prices by 14 percent on its NetVista N2200 thin clientdevices and announcing plans to invest $100 million in marketing andadvertising campaigns to support NetVista as a whole.
IBM’sHunger says that far from replacing corporate desktop PCs, most thin clientswill replace existing terminals in transaction processing and in othertask-oriented environments.
“Where thinhas really worked extremely well is in call centers, with airline reservationclerks, and with people who do repetitive transaction-oriented tasks day in andday out,” he explains. “In fact, some of our biggest [thin client] roll-outsright now are on airline reservation systems.”
PCs havevalue for power users and for users who create or manipulate data in corporateenvironments. But IBM’s Hunger points out that for every user who needs thepower, flexibility, and performance of a high-performance PC or workstationthere are a number of users in task-oriented positions for whom a host-basedthin client computing model simply makes a lot of sense.
Thepredecessors of today’s thin client devices were slated to run a variety ofoperating systems -- including Microsoft’s Windows CE and Sun MicrosystemsInc.’s (www.sun.com) now-defunct Java Station-- but industry watchers expect that the open source Linux operating systemwill emerge as the thin client operating system of choice.
IBM’sHunger agrees. He says IBM’s thin client devices can run on several operatingsystems -- including Microsoft’s Windows CE -- but will probably primarilyleverage Linux.
“Wediscovered that what customers are really looking for is ease of install andfunctionality that gets them access to the server, so we believe that thefuture for thin clients is very strongly in the Linux area,” he says.
Becausethere are open source implementations of Microsoft’s remote desktop protocol --and because Citrix provides ICA software for Linux -- IT organizations don’thave to run Windows CE on the client to run multiuser Windows 2000: They candeploy Linux-based WBTs.
On the PC side,however, there’s no reason to expect that Windows won’t continue its desktopdominance. Giga’s Enderle points out that, not only are users familiar withWindows and its wide range of supported applications, but IT managers also havebeen encouraged by the manageability enhancements of Windows 2000, which makeit the smart choice for most PC desktops.
“Windows2000 has significantly improved and enhanced the manageability andserviceability of the PC desktop,” Enderle says. “Because of that, PCs are goingto be around for a very long time.”
AndyBozington, product marketing manager at Santa Cruz Operation (SCO, www.sco.com), says a shift in the enterprisecomputing landscape is taking some but not all of the primacy away from thetraditional desktop PC and returning it to the backroom server. While thisshift may create an opportunity for thin clients and for terminal devices,Bozington notes, it’s simply not ideal or practicable in all environments.
“No one’sreally going to have a single environment where every application is the sameand every server is the same, so there’s going to be diverse environments withthin clients and PCs whatever you do,” he says.
AProduct Juggling Act
Successfullymanaging discrete PC and thin client marketing strategies is a juggling actthat can rival the most acclaimed of circus performers. PC vendors must becareful not to scare off existing or potential customers by giving a falseimpression of abandoning the PC paradigm in favor of the thin-client model.
CompaqComputer Corp. (www.compaq.com) tackledthis problem earlier this year when it introduced its new iPaq desktop, a thinclient alternative for the PC on the corporate desktop.
Whileacknowledging that his company would likely unveil similar thin client devicesin the future, Michael Winkler, senior vice president and group general managerof Compaq’s commercial personal computing group, says all present and futurethin client products will be positioned as complementary to Compaq’sbread-and-butter PC business.
“We’rebuilding upon Compaq’s iPaq, a vision established by the unique iPaq desktop,”he says. “Our goal is to deliver simpler, practical devices that complement ourtraditional PC business.”
To thatend, Compaq’s subsequent doings in the thin client space have consistedprimarily of devices that fill gaps in the functionality of the PC. One gap isthe on-the-go business user. In this area the computer giant’s new iPaqBlackBerry wireless e-mail device provides business users real-time wirelesse-mail and paging services with integrated security.
“[iPaqBlackberry] offers complete integration with your corporate MicrosoftExchange-based e-mail account,” explains Michael J. Larson, senior vicepresident and general manager of Compaq’s consumer products group.
Whilecomarketing both thin clients and full-fledged PCs, many vendors will continueto slim down the PC form factor. IBM, for example, markets a NetVista PC -- theNetVista X40 -- that consists of little more than the innards of a desktop PCmounted on the back of a flat panel display. Gateway 2000 Inc. (www.gateway.com) sells a similar device.
IBM’sHunger expects PCs to continue to be slimmed down, but never to be fully gottenrid of.
“As we goforward, the size of PCs is going to decrease dramatically,” he concludes. “Asa result of this convergence, what we’re going to see is hardware devices thatare going to be built more on PC structures that are operating without harddrives or some of the other trappings of the PC.”