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Gateway lures businesses with NetPC

The consumer PC maker will charge into the business market with a sub-$1,000 PC that meets many NetPC specifications.

BURLINGAME, California--Gateway 2000 (GATE) will jump the gun a bit and announce tomorrow the first NetPC from a top PC vendor that is also the company's first PC specifically designed for business use.

Gateway, which has traditionally sold PCs to consumers, will charge into the business PC market with a sub-$1,000 PC called the E 1000 that meets many of the NetPC specifications as set out by companies such as Intel, Microsoft, Compaq, Hewlett-Packard, and Dell Computer.

"This is just for the enterprise (corporations). It's our first product for that market," said Gateway CEO Ted Waitt in an interview today with CNET's NEWS.COM at the PC Tech Forum here.

Waitt added that Gateway is still trying to sort out the NetPC specifications, saying that it's a little early in the game to categorically dub it a NetPC. "It will offer a lot of the benefits of a NetPC," Waitt said. But he added that it will offer some features that the NetPC specification doesn't call for, including older "ISA" technology. ISA is an older 16-bit technology that is still necessary for many add-in cards. ISA has been superseded by 32-bit PCI in many areas.

The bare-bones machines will be targeted at large companies for use on their corporate intranets. By using the NetPC model, Gateway hopes to extend its product line with a set of computers offering both low hardware and low upkeep costs, two of the major features of the NetPC specification.

The rollout makes Gateway the first major vendor to offer a NetPC, which the company hopes will strengthen its relatively weak market share for large corporations. It won't be alone for long, however. Compaq Computer, Hewlett-Packard, and Dell computer created the original NetPC specification along with Microsoft and Intel, and those manufacturers are expected to release their own versions of the device.

The minimum hardware requirements for a NetPC call for a 133-MHz Pentium processor, 16MB of memory, and a hard disk drive.

The NetPC management specifications also require that a system can be set up remotely, booted up remotely, and generally controlled remotely. This, the theory goes, saves a company lots of money since information system personnel do not have to visit every computer individually to perform these tasks. That can get costly if a company has hundreds or thousands of PCs.

The E1000 supports either Windows 95 or Windows NT Workstation, but more significant PC management efficiencies will be realized with Windows NT Workstation 4.0 and later versions, according to the specifications.

The E1000, in some configurations priced under $1,000, will offer a 133-MHz Pentium processor, 16MB of memory, a network card, and software and hardware allowing it to be set up easily on a network, Waitt said.

An information system manager with Nordstrom, the department store giant, said he is looking seriously at NetPCs. "There is a need for this kind of niche market. We want to move [powerful] computing out to the sales floor, a nice-looking touchscreen PC that connects to the network. The NetPC looks like it can do this," said Larry Shaw of Nordstrom. Shaw said that NetPCs could replace many of the thousands of older mainframe terminals the company has.

Gateway is working to address a critical need in business for easy-to-use computers, Waitt said. "Corporations want stable, reliable, and easy-to-maintain systems," he said. Gateway is expected to announce tomorrow a new line of desktop and notebook PCs that will address the needs of the corporate marketplace, including a variation of its Destination PC-TV product.

Microsoft is planning technology for Windows NT 5.0 and its Memphis operating systems, which enhance the management and control of NetPCs according to the NetPC specifications. Windows NT 5.0 and Memphis are next-generation Microsoft operating systems due in 1998.