IBM first major firm to unveil NC

Electronic News, Sept 9, 1996 by Elaine Chen

Last week, IBM became the first major company to introduce a "network computer" with the launch of its Network Station, a low-cost terminal capable of accessing the Internet.

Irving Wladawsky-Berger, GM of IBM's Internet Division, said, "The IBM Network Station is a cost-effective way for many of our customers to enhance the value of their networks, and allow their employees and customers to get connected." However, analysts indicate the Network Station looks a lot more like the "dumb" terminals of the past than the Internet appliances of the future.

The NC concept has long been championed by Oracle and was endorsed by Sun Microsystems, Apple Computer and Netscape Communications, along with IBM, last spring (EN, May 20). Under the model proposed by Oracle, a "thin client" computer, containing little or no internal data storage, will be used to access the Internet as well as applications and data stored on a central server. IBM's Network Station is the first NC-type product from the companies participating in the May announcement of the NC reference standards.

The Network Station is priced at approximately $695 and includes a PowerPC processor and 8MB of memory, expandable to 64MB, packaged into a slim central unit weighing two-and-one-half pounds and measuring 8 by 10 by one-and-one-quarter inches. It supports a standard PC keyboard and mouse and optional monitor and includes a printer and serial port. While IBM would not disclose any specs for the processor, Tom Bittman, research director for the Gartner Group, said the Network Station utilized a PowerPC 403 chip. The Network Station will be available in the fourth quarter of this year.

With only 8MB of memory and limited processor power, application software and data clearly must be stored elsewhere. According to IBM, downloading and transfer of software and data will be transparent to the user. Powering on the Network Station initiates a connection to the host server. After user log-in, the host server will establish connections to other servers and download software to the terminal based on a user profile. Bruce Anthony, lead engineer for the Network Station, stated that the Network Station "can boot in 30 seconds to a minute on a lightly loaded network," although he cautioned network delays could certainly prolong the process.

Following download, users may connect to multiple servers simultaneously and access E-mail and workgroup applications via a graphical interface. Changes implemented at the server will be replicated to the Network Station, allowing users to input data and edit documents as on a traditional desktop PC. The Network Station also supports Netscape's Navigator 3.0 Web browser, which will be customized for the Network Station by Netscape's NAVIO subsidiary.

IBM has positioned the Network Station at least in part as an Internet access device, emphasizing its Netscape capability and the new importance of "e-business" in press materials. Yet notably, the Network Station does not currently provide a modem connection. Its present configuration includes network adapter cards for Ethernet and Token Ring LANs, with twin-ax and co-ax cable adapters planned for the near future.

Mr. Anthony of IBM said modem capability for the Network Station is still in development. As dial-up connections suffer from limited bandwidth, more software must remain resident on a modem-enabled NC in order to avoid lengthy downloading delays. Mr. Anthony said IBM is accordingly working on adding memory via a PCMCIA card, as well as an automatic update capability to allow the resident software to be changed remotely. Given these added technical requirements, Mr. Anthony said a modem-equipped model probably would not be available for at least another six months.

According to analysts, the high bandwidth requirements and limited processing power of the Network Station could pose difficulties with many applications. Mr. Bittman of the Gartner Group said, "There's a delay when you first start, and it could be considerable." He added that use of personal productivity tools such as Microsoft Office would really not be possible on the Network Station and that it "may not have the horsepower to handle the Internet." Norm Bogen, analyst for In-Stat, agreed, stating, "Without the hard drive...it's going to eliminate some applications that people want to run."

Yet although the Network Station may not be able to push aside the desktop PC, it is a suitable replacement for non-programmable terminals, or dumb terminals, initially used to access mainframes in the 1970s. Dumb terminals are now primarily utilized for host-centric applications such as data entry, order-taking and travel reservations. As many companies have been forced to purchase low-end PCs to fill the dumb terminal function, the Network Station provides an attractive alternative. Mr. Bittman termed it "the cheapest, easiest way to access host-centric applications."

As noted by Lenny Pitts, analyst with Technology Business Resources, the dumb terminal sphere "is not the market for NCs that's hyped in the press." Nevertheless, as noted by Mr. Bogen, "It's a nice-size market for IBM...I think it's going to be successful for them." Mr. Bittman agrees. Even without the glamour and excitement of the Web devices from hot new companies like Diba, "they will sell out of this stuff," Mr. Bittman predicted.