11/18/96 BATTLE OF THE NETWORK BOXES

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BATTLE OF THE NETWORK BOXES

When Intel Corp. and Microsoft Corp. unveiled plans for a NetPC on Oct. 28, there was no gloating at Sun Microsystems Inc. or Oracle Corp. Sure, on the face of it, the Wintel pair seemed to endorse the Oracle/Sun Network Computer (NC) concept that's also supported by IBM Corp. But the NC crew recognized the NetPC for what it is: a preemptive strike.
By creating a stripped-down personal computer for networks that--unlike the NC--also runs software PC owners use, the NetPC could dull any edge the upstart design had. ''This could stall the NC's momentum,'' says analyst Eileen O'Brien of International Data Corp.
The reason is simple. Despite all the noise about Internet computing, what both approaches offer the corporate buyers they're aimed at is a way to cut costs. Researcher Gartner Group estimates that corporations spend more than $8,000 a year per PC on support and maintenance. The NCs proposed by IBM and others cut this cost by returning control of a company's desktop machines to the corporate computer department--eliminating expensive support nightmares like hard-disk crashes and software foulups caused when workers install programs. Gartner analyst Bill Kirwin estimates NCs could slash support costs by 30%.
Customers are ready. John Andrews, president of railroad giant CSX Corp.'s technology unit, says he expects 10% of his employees to use NCs within two years. Barry Lynn, a Wells Fargo & Co. executive vice-president, figures NCs will cut his cost of supporting each desktop computer user to $2,000 a year. ''There's a future for these,'' he says.
But the NC faces some big obstacles. The biggest is software. While the machines, which are being built around such non-Intel processors as the IBM-Motorola PowerPC, Sun's SPARC, and the ARM chip from Britain's Advanced RISC Machines Ltd., will run the cool new software ''applets'' being written in Sun's Java language, few such programs now exist, and most likely won't be widely established for years. Familiar office ware such as Excel and Word may never be available for Java.
This is why, by simply announcing plans for the NetPC, Intel and Microsoft have dealt a blow to the NC. The NetPC standard--a blueprint that companies such as Compaq, Hewlett-Packard, and Dell say they'll follow--lets companies keep all their PC software and also addresses the cost-of-ownership issue, too. The standard specifies technology that will allow each PC on a network to report to a central server its status and warn of impending problems. Using software on Windows NT servers, computer managers will be able to monitor PCs, install new software from the server, and even help traveling workers using laptops.
The NetPC, crows Microsoft Senior Vice-President James E. Allchin, offers ''the best of both worlds.'' As long as those worlds are called Microsoft and Intel.
By Andy Reinhardt in San Francisco

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