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IBM succeeding in NC market

IBM has taken orders for "tens of thousands" of its Network Station 1000 model since its early December introduction, while Sun and Oracle continue to struggle.

IBM's (IBM) Network Computer (NC) appears to be making headway in the corporate market, while Sun Microsystems and Oracle's Network Computer Incorporated (NCI) have yet to make an impact.

IBM has taken orders for "tens of thousands" of its Network Station 1000 model since its introduction earlier this month, according to a company spokesman. The $999 model is IBM's first Java-enabled NC and also accommodates forthcoming Windows terminal software from Microsoft.

Meanwhile, Sun missed a November target date for the introduction of its Javastation NC, a release that was originally scheduled for February, and NCI recently trimmed about 15 percent of its workforce, reassigning some of its corporate sales personnel in a move that indicates the company will focus on the consumer market. (See related story)

NCs are devices aimed at reducing the overall cost of computing for large organizations. Typically they perform a limited number of functions on the desktop while acting as a window to a "fat" server, where some computing and nearly all of the data storage takes place.

Touting the "write once, run anywhere" Java programming language, Sun and Oracle have been the NC's most vociferous advocates since the announcement of the low-cost computing platform in late 1996, but neither company has matched IBM in terms of product delivery. Big Blue says some 3000 firms have ordered versions of its NC since March 1997.

Sun's Javastation is now due in the first quarter of 1998, while NCI continues to struggle with a business model limited to providing software for a sparsely populated segment of relatively small manufacturers making Java-based units.

The slowness of Java productivity applications such as Lotus Development's eSuite in reaching the market has also hindered the Sun-Oracle camp. "The whole [NC] market is stalled waiting for Java to show up," said Audrey Apfel, vice president of networking technology for the Gartner Group.

IBM skirted the problem by offering Network Station models that function more like traditional "green screen" or "dumb" terminals, machines that depend on a central server to process information. The 100 and 300 series use software based on Citrix technology to access data and applications on a Windows NT-based server or a Unix-based server, for example, meaning they can handle mainframe "legacy" applications.

IBM's Network Station 1000 is also capable of running Microsoft's forthcoming Hydra server software, which is due in mid-1998. Hydra is intended for use Windows terminals, an NC-like device that will enable access to Microsoft's popular productivity applications.

"People want to do Windows on these boxes," Apfel said of IBM's decision to accommodate Hydra. "People find [IBM] is a good tactical choice. IBM has a certain appeal as a safe vendor that supports customers through [market] transitions."

IBM's position in the NC market stands in ironic contrast to its previous decision to abandon the Net PC segment. In September, the company announced it was moving away from plans to build and sell still another type of scaled-down PC.

Only about 20 percent of the NC's saving are realized by the desktop unit, according to IBM. The rest comes from reduced labor as a result of remote management, such as installing new or upgraded applications.