The Sun Also Rises: Is A New Era Coming?
Briefing.com
Just two days ago, I wrote on these pages of the coming of the new era of software, with Sun Microsystems leading the charge. Before the ink even dries on Sun's Star Division acquisition announcement, Sun announces the Sun Ray, a brand new type of computer monitor for the new era of software. The shift towards an internet based thin client computing model may happen quickly.
The Sun Ray
So what is the Sun Ray? Sun Microsystems (SUNW) introduced on Wednesday a new terminal for internet applications. The Sun Ray is really a PC monitor stripped down to the bare essentials needed to run a browser and Java based applications. There is no local storage or operating system.
At the human interaction level, a Sun Ray contains everything a PC monitor has: keyboard, mouse, display unit. But the software to run applications on a Sun Ray terminal is located on Sun Solaris-based servers. Upgrades to any functionality are made at the server level; no changes are required at the Sun Ray end.
The Sun Ray is completely application independent. It only displays applications which are stored and maintained on the servers.
The Chances?
So what chances does this new model have?
For new models to succeed, they have to radically lower the costs of the current implementation. Otherwise, the motivation for change is hard to justify in a corporate environment. The cost reduction has to be significant as well. A savings of 10-25% is simply not enough to justify the difficulty of change. The thin client model will need to cut IT costs by at least half. True computing revolutions have had costs savings of ten times the previous model.
So the key question is whether the internet-based thin client model will save enough to overthrow the networked PCs on the desktops of the corporate world.
To have a significantly lower costs, the new model must do the following:
Reduce IT maintenance costs (departmental budgets cut in half)
Reduce costs of upgrades (by at least half)
Simplify the learning curve for users, thereby reducing support costs for IT (primarily headcount reduction)
Reduce the costs of adding new users to the network (probably needs to be 1/4 or less of the cost of a new networked PC)
At first glance, it appears that Sun's new architecture can achieve these goals. However, since the true cost savings is in operating a thin client model, not purchasing it, the cost savings are a little harder to predict. The must however, be overwhelming obvious to whatever management group makes the purchasing decisions.
Certainly the cost savings in IT maintenance are clear.
In a Sun Ray style environment, maintenance efforts are primarily focused on the server. Unlike current client server environments, the client side of a thin client is completely independent. There is no client side software piece which must be matched to the server side software. Upgrading the server makes the entire system upgraded.
For example, installation of a new printer in a simple networked environment requires installation of a new printer driver on every PC in the network. This single task is a nightmare for IT departments. Automated products for printer servers were designed to simplify this desk. But in the Sun Ray environment, no alteration of any desktop device is necessary. All of the printer functionality resides on the server.
But for some applications, the benefits of the thin client environment are obvious. Wide spread networked PCs such as airline reservation systems are maintenance nightmares, particularly for upgrades. If the local PC functionality could be entirely replaced by a thin client monitor, at a lower cost to install, and a lower cost to maintain, the model could win acceptance quickly.
Possible Problems
What could keep the thin client model from being adopted by the corporate world?
First of all, it has been tried before.
A similar type of monitor architecture has already been tried on the marketplace, in the early 90s. It was called the "X-Window" terminal. The X-Window design was a first attempt at implementing a thin client model for networks. X-Window terminals ran all of the functionality of a workstation monitor, but solely as a display and input/output device.
The X-Window, however, was a complete failure in the marketplace. One possible reason for this may have been the high cost. A second reason is that X-Windows were sold primarily into the workstation environment, to high powered users. Those technical users wanted complete control of their local computers.
For the Sun Ray style computing model to succeed, it must win acceptance in ordinary corporate and work environments. Inventory management in warehouses and accounting departments are the marketplaces where the Sun Ray must succeed.
However, there is a more serious built in hurdle to this model. The very persons who make IT recommendations within a corporation are the very people threatened by this model. Management is going to have to deal with purchasing a technology that will be implemented by the very people it will replace.
The cost savings will need to be powerful enough to overpower the entrenched model.
Overall Positive Development
On the whole, however, Sun's new direction is encouraging. If Sun Ray sales are explosive, the implications for the PC world are serious, especially for traditional client-server style software companies, such as PeopleSoft (PSFT).
In Tuesday's Stock Brief, I quoted from David Stone, Vice President of Software at Digital Equipment Corporation in the 1980s. David Stone believed software should be as transparent as possible. He frequently said "No one wants to buy an electric drill and drill bits. What they really want are holes. If you could only sell a box of holes, drill bits would become extinct."
Sun's move is a step in this direction. The thin client model is an attempt to put only the application level on the desktop.
If it happens, the thin client paradigm shift has all the appearances of the biggest shifts in technology history. Those previous shifts all had the same effects for investors: the existing paradigm became much less valued, and the new paradigm became highly valued. Investors who recognized those shifts early on were the biggest beneficiaries.
Only time will tell whether the thin client paradigm shift fits that pattern. But Sun Ray sales can now serve as a proxy for the thin client model, and should be watched closely.
Comments can be emailed to the author, Robert V. Green, at rvgreen@briefing.com.
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