NetPC muscles in on NC

Microsoft-Intel alliance unveils strategy

by Geof Wheelwright

With Microsoft and Intel's official entrance into the battle for the new corporate network computer market in late October at the unveiling of the NetPC, the so-called Wintel alliance has finally dropped the pretense that the network computer idea doesn't matter.

Oracle, Sun Microsystems and dozens of others have made so much noise about the idea of a computer designed principally to connect to the Internet or an internal corporate intranet-and have recently been producing real-life products to prove it, under the umbrella name NC, or network computer-that Microsoft and Intel were forced to set out some clear plans in response.

What's a NetPC?

The first of these was the Simply Interactive PC idea announced in the spring of 1996, which seemed long on rhetoric and short of timetables. The companies corrected this on Oct. 28, with the announcement of "an initiative to develop the NetPC reference platform." Intel and Microsoft are portraying this NetPC as a "new member of the PC family that will reduce the costs of business computing by optimizing design for a particular class of task-oriented users who do not require the flexibility and expandability" of the traditional PC.

The companies went to great lengths to emphasize that this NetPC is supposed to be a new PC family member, and definitely not a replacement for anything the companies are already offering. The NetPC is supposed to let PC vendors make Intel-based systems using the Windows operating system "that lower the cost of owning PCs."

The strategy, clearly, is to distract vendors from making non-Windows Internet computers that do not use Intel chips, although Intel and Microsoft would prefer to emphasize the overall benefit as "reduced support costs, a stable hardware platform for several years, a lower initial purchase price, and the ability to build upon existing organization training, development and capital investments in Windows and applications designed for Windows."

The line on all this from the existing market leaders is that, although PCs have "always offered" the highest level of price/performance, compatibility and adaptability, many people still think they are too expensive to buy and maintain.

The companies have therefore set their sights on producing cheaper machines that will cost less to run and have less chance of becoming quickly obsolete. To do this, they pledge that the NetPC reference platform will specify industry-standard components (i.e., processor, memory, hard drive, video, and audio) with an integrated network adapter or modem in a locked case with limited expandability to prevent user modification.

Who will support them?

In many ways, the whole initiative comes across as trying to do for the PC industry what the automatic transmission did for the car. Intel, in particular, seems keen to claim its share of the credit. "This new effort, to deliver a PC platform for specific types of users, builds upon Intel's Wired for Management initiative to reduce total cost of ownership without sacrificing necessary performance," says Frank Gill, executive vice-president at Intel. "By delivering an appropriate level of flexibility, the NetPC is the natural next step in further reducing total cost of ownership while maintaining the strategic value that PCs deliver to business."

Despite this obvious trumpet-blowing, the NetPC appears to have no shortage of manufacturers lined up to produce the systems, with Hewlett-Packard near the head of the line.

"The NetPC offers the critical elements of both PC computing and network computing without introducing costly incompatibilities," says Jacques Clay, general manager of worldwide commercial PC business at HP. "The NetPC will provide customers with the best combination of end-user simplicity, low cost of ownership and high return on investment of any solution available for task-oriented computing. HP is committed to delivering a NetPC solution in 1997 as part of our Vectra PC family, extending the range of best-in-class client, network and systems management solutions we offer to our desktop customers."

On first inspection, it is hard to see what is different in this proposition from the dozens of cheap, sealed-case PC systems that have been proposed and produced over the past 10 years, except that this one will run Windows 95 and be able to view Web pages and handle e-mail. The United Kingdom's own Apricot was for years a champion of the "diskless workstation" and an initial look at this proposition would not reveal a huge difference between the specs of the NetPC and a typical diskless PC, except that the latter does have its own local storage.

Aiming for zero administration

According to Intel and Microsoft, however, the real difference between this plan and those that have gone before lies in the way the NetPC will be maintained and administered. The NetPC arrives at a time when Microsoft has introduced something it calls a Zero Administration initiative for Windows, and Intel is touting its aforementioned Wired for Management scheme.

These two efforts promise to allow organizations to easily update software remotely or allow users to move seamlessly from one machine to another with all their data and applications accessible, and their customized environment automatically applied to the new PC.

Of the two efforts, the Microsoft Zero Administration initiative bears the most close inspection, as it was launched hand-in-hand with the NetPC. Microsoft is clear that the effort is aimed at both existing Windows-based PCs, as well as the new NetPCs.

It further promises that the initiative will "significantly reduce the cost of owning PCs while maintaining their existing investments in industry-standard hardware and software" by building on the existing investment companies have in the Windows operating system, while allowing them to automate PC management and deploy the widest choice of applications in a controlled way.

"Microsoft is committed to solving the hard problems customers face today," says Microsoft chief executive officer Bill Gates. "Customers want to be able to update software without touching every machine and allow users to seamlessly move from one machine to another. And they want to gain these benefits without introducing the unnecessary complexity of new, incompatible hardware and operating systems."

Microsoft pledges that the Zero Administration initiative will give IT professionals new levels of control and manageability over their Windows-based environments by automating such tasks as operating-system updates and application installation, and by providing tools for central administration and desktop system lock-down. In this brave new world, Microsoft sees a time when administrators will be able to let users roam between PCs without requiring their applications and files to be reinstalled each time. The Zero Administration initiative is also supposed to enable application software developers to more easily develop and deploy a wide range of applications.

For longtime computer professionals, the specific features of the Zero Administration may look extremely familiar, particularly when viewed from the perspective of the old mainframe and minicomputer world. Microsoft says you'll see a number of key features in the initiative, including the following:

Automatic system update and application installation: Microsoft says the operating system will update itself when the computer is booted, without user intervention, seeking the latest necessary code and drivers from a server, intranet or the Internet, if available. Meanwhile, the Automatic Desktop feature will apparently provide users with all available applications, installing them automatically when invoked.

All status information kept on the server: Under this scheme, a user's data can be automatically "reflected" to servers, supposedly ensuring high availability and allowing mobile users to have access to information whether connected to the network or not.

Central administration and system lock-down: It sounds like mainframe talk, tastes like a mainframe idea. Here, all aspects of client systems will be controllable by a central administrator across the network. Microsoft says that in a few simple steps, the system can be locked down to "maintain controlled, consistent and secure configurations across sets of users." The degree of flexibility can be altered on a per-user basis by the central administrator, without having to change hardware and software.

Microsoft says these functions will be available in varying degrees on future versions of Microsoft Windows 95 and Microsoft Windows NT Workstation, and will be supported by Windows NT Server-as well as being part of the NetPC effort.

Microsoft says that, according to computer industry analysts such as The Gartner Group and Forrester Research, features such as remote diagnosis and management of key system services, standardized system policies and centralized user profiles, and Windows NT Workstation's ability to securely lock down system configurations will result in savings on support costs and improved manageability.

And it does, of course, all tie back into the whole NetPC idea. "The NetPC will be an important PC platform that organizations can deploy to increase return on investment, especially when combined with Microsoft's Zero Administration initiative for Windows," suggests Paul Maritz, group vice-president at Microsoft. "The Zero Administration initiative builds on companies' existing investment in Windows, while allowing them to automate PC management and deploy the widest choice of applications in a controlled way."

At the NetPC starting gates

Leading PC manufacturers who announced support for the NetPC so far include Compaq, Dell, Digital Equipment Corp., Gateway 2000, Hewlett-Packard, Packard Bell, NEC and Texas Instruments.

The support of Compaq, in particular, has to be important to Intel and Microsoft. Compaq senior vice-president and group general manager of enterprise computing group, John T. Rose, has made the point that this isn't about just producing cheap PCs. "Compaq's objective is to maximize customer value by delivering systems solutions with the lowest total cost of ownership in the industry," he said.

Meanwhile, youthful Michael Dell, the chairman and chief executive officer of a resurgent Dell Computer, appeared to be using the NetPC announcement as a chance to take an oblique swipe at Sun and Oracle by making them look like the ones opposing "open" standards with their respective JavaStation and Network Computer announcements.

"At Dell, we have consistently supported open standards, which is one of the key reasons we believe this announcement is critical," says Dell. "The industry has seen a number of proprietary designs for network computers proposed recently-a clear step backward that would require customers to support multiple computing environments, increasing support costs and complexity. We believe a highly manageable PC based on Microsoft and Intel solutions is better for customers looking to reduce their overall cost of ownership. The NetPC concept is ideal for task-oriented workers, and the NetPC design specification offers customers a totally managed approach within the framework of their existing environment."

Over at Digital Equipment, there are clear signs the company wants to be a part of a winning strategy and sees itself with unique credentials in this effort. "Digital, known worldwide as a provider of enterprise solutions and for its commitment to the Windows NT platform, strongly endorses industry efforts to lower the overall cost of ownership for personal computers in networked environments," offers Scott Cutler, Digital's vice-president and personal computer business unit chief technology officer. "We have traditionally focused on manageability and security in networked business environments, and we endorse efforts in the industry to move in this direction, as it is critical to customer needs."

Does this change my life?

For the major players in the PC industry, the main result of all this is that they can rest assured there will be a way to meet the anticipated demand for network computer-style devices. The real difference is that there will finally be some true competition with a credible story to tell, and that Intel, for example, will have to really be on its toes to make sure that the processor end of things can stand up well to both Sun's Java chips and the Acorn ARM chips being used in the network computers so far announced by many of the Oracle Network Computer licensees.

Microsoft, meanwhile, will yet again have to come up with lots of reasons to stay with Windows, particularly when Java-based word-processors, spreadsheets and presentation packages start arriving with the capability to run on any system that can use a Java-based browser.

One interesting wrinkle in all this is that Intel may sidestep its part of the debate by having its chips used in versions of the Network Computer. In fact, in an address to the press and analysts at Oracle World in San Francisco a few months ago, Oracle chief executive officer, Larry Ellison, showed off a prototype of an Intel-based Network Computer and then proceeded to suggest that Intel-based network computers would probably form the bulk of the systems sold to corporate accounts.

He said that although ARM chips were cheap, well-designed and fast, the corporate computing world had a love affair with Intel that he would not attempt to interfere with. Although Ellison has not yet announced a single manufacturer planning to offer Intel-based Network Computers, it is clear that he is trying to use this as a way to cleave the so far impenetrable Microsoft-Intel alliance.

This development makes it quite clear that Oracle's whole network computing initiative is really aimed straight at the heart of Microsoft in an attempt to unseat the boys from Redmond in their huge position of influence on the computer industry.

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TCP Online February 1997 Issue