From WSJ:
Network Computer Market
Still Exists Despite IBM Move
PALO ALTO, Calif. -- International Business Machines Corp. won't build a
NetPC, but the market for lower-cost network computers hasn't disappeared,
say industry analysts.
Big Blue's decision not to sell a machine based on the NetPC design is a blow to
Microsoft Corp. and Intel Corp., the companies behind the specifications. But
the prospects for stripped-down computers of other types that offer lower
ownership costs and greater flexibility are real, say these analysts.
Corporate customers didn't "get" the NetPC, said
Tom Rhinelander, an analyst at Forrester Research
Inc. of Cambridge, Mass.
The machine was designed to have a sealed case,
with no floppy or CD-ROM drive, and a greater
ability to be centrally managed and maintained; it also was meant to sell for $200
to $300 less than full-fledged PCs.
But as the price of PCs fell, the cost differential disappeared, said John
MacGilvary, chief analyst for Datapro Information Services Group, a division of
McGraw-Hill Cos.
Many corporate customers reasoned they could get the added features of a PC
and the improved manageability of a NetPC by buying a PC, he said.
The bad news for Microsoft and Intel is good news for makers and designers of
other network computers, including Oracle Corp., Sun Microsystems Inc. and
IBM itself, which sells its own line of network computer, Mr. Rhinelander said.
But that also doesn't mean the market will take off by itself. These companies
still will have to convince people to buy the machines, Mr. Rhinelander said.
While the market is still fledgling, Jeffrey Menz, director of product management
at Oracle's Network Computer Inc., said he is encouraged. NCI is receiving
monthly orders in the "multi-thousands," and tens of thousands of machines are
in pilot projects, he said.
Mr. Menz told Dow Jones he expects a "big surge" in the market by the end of
1998.
IBM explained its decision by saying its customers preferred to have network
management capabilities built into ordinary PCs instead of in new devices. But
analysts said a network computing device is still a compelling notion, especially
when it is not married to the world of Windows software.
People won't buy network computers because they save a few dollars, Mr.
MacGilvary said, but will purchase them for their flexibility.
Not only will the machines access current computer application software
running on Unix, mainframe or Windows servers, but they will link to the next
generation of applications, which may be Java-based. This makes them less
likely to become obsolete, he said.
Network computing is the "first technology in years to offer a competitive
advantage," Mr. MacGilvary said. |
