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November 2, 1998

High Hopes For The New NT

Microsoft has repackaged Windows NT 5.0 and given the operating system a new name-Windows 2000. Users are getting ready for it.

By Stuart J. Johnston

Related stories:

This article is part of a joint research and reporting project on Windows 2000 by the editors of CMP Media's InformationWeek, Network Computing, Computer Reseller News, and Windows magazine.

For more on Win2000, see:

NT5: Miles To Go Before Win2000

Unix, NT Mix It Up

Behind The Numbers: Expectations For Win2000

oodbye Windows NT 5.0, hello Windows 2000. Microsoft last week changed the name of the operating system upgrade it has been touting for two years as its next-generation business computing platform. Microsoft will sell the operating system--still due sometime next year--in four configurations, including a new "data center" version that will run on servers with up to 16 processors. But marketing and new moniker aside, where does Microsoft's operating-system overhaul fit into IT managers' plans? A new survey by InformationWeek Research shows there's huge pent-up demand for the product among businesses of all sizes, which are interested in its improved management features and potential for lowering costs.

Microsoft has set high expectations for Windows 2000. For months now, Microsoft executives have been playing up the operating system's many improvements--including its directory services, IntelliMirror disk-mirroring technology, and very large memory--and the message seems to be getting through. When Windows 2000 ships, businesses will adopt it at an unprecedented pace. Nearly two-thirds of companies evaluating Windows 2000, or planning to evaluate it, plan to widely deploy the operating system within 12 months of release, according to the InformationWeek Research survey, conducted in September and October. Within 18 months of release, 78% plan to widely deploy the workstation version of Windows 2000, while 74% say the same for the server version.

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Ultimately, almost nine of 10 Windows 2000 evaluators say their companies will use it widely. "We're very aggressively evaluating it, and we're dying for it to be real," says Diana Beecher, senior VP and CIO of Travelers Property Casualty Corp. in Hartford, Conn. The $10 billion Citigroup business unit is upgrading 22,000 PCs and the servers that support them to Windows NT 4.0. Travelers will move to Windows 2000 as soon as the company's year 2000-related work is completed. "Our goal is to do all of the homework on [Windows 2000] now," Beecher says. Travelers expects Windows 2000 to make its enterprise network more manageable as it improves network access for its own offices, as well as for its partners.

But not all companies are that enthusiastic. Of the 438 IT managers contacted by InformationWeek Research, 32% have no plans to test Windows 2000 at all. "We have marginal interest in it," says Robert Rubin, CIO of Elf Atochem North America Inc. in Philadelphia, the $2 billion U.S. subsidiary of Elf Aquitaine Group. "Our experience is that early releases of Microsoft software are marginal in terms of stability and value." The chemical company, which uses Banyan Vines as its network operating system along with Unix and NT for some applications, is not testing Windows 2000. "If we adopt it, it will be after 2000," says Rubin.

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But among the 300 survey respondents testing Windows 2000 or planning to test it, 92% are evaluating it for both workstations and servers. The numbers indicate that Windows 2000's adoption will be both broad and fast, even by Microsoft standards. They're proof that the company has done an effective job pre-selling the system's capabilities to IT management.

Last week's makeover of Windows NT is an effort to keep up the momentum. "No matter what you do, there's a version of NT Server that's right for your needs," says Mike Nash, Microsoft's director of Windows 2000 Server marketing. The desktop product previously called Windows NT Workstation 5.0 is now Windows 2000 Professional. Windows NT Server 5.0 is now called Windows 2000 Server, while Windows NT Enterprise Edition 5.0 is Windows 2000 Advanced Server. The entirely new Windows 2000 Datacenter Server becomes Microsoft's high-end operating system package.

As part of the move, Microsoft is reducing the number of processors supported in its server line from four CPUs in NT Server to two in Windows 2000 Server, and from eight in NT Enterprise Edition to four in Windows 2000 Advanced Server. Companies that need servers with more than four processors must license Windows 2000 Datacenter Server.

How does that translate in licensing fees? Microsoft didn't disclose pricing, but says Windows 2000 Advanced Server will likely cost less than NT Enterprise Edition and indicates other pricing changes will be minimal. Still, companies moving to servers with four or more processors will probably end up paying more for Windows 2000 Datacenter Server than they now do for NT Enterprise Edition, which is priced at $3,999 for a 25-user license.

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The price of software licensing isn't a big issue for Windows 2000 evaluators. Price was at the bottom of the list when InformationWeek Research asked Windows 2000 evaluators about the key criteria by which they would judge the operating system. Far more important are the software's reliability and stability, cited as being key by more than 90% of Windows 2000 evaluators (see chart). On that, Microsoft seems to have done a good job. InformationWeek Labs found Windows NT 5.0, beta 2, to be "quite stable," though still needing a lot of work before its general release (see story, "NT 5: Miles To Go Before Win2000"). "Users would much rather NT 5 be done right than done early because they're looking for a rock-solid enterprise product. Anything less would be unacceptable," says Rob Enderle, an analyst with Giga Information Group.

New York's Metropolitan Museum of Art has been pleased with its own tests of Windows 2000 beta code, says Arthur Tisi, the museum's CIO. "It shows what Microsoft can do when they're serious," says Tisi. The museum, which currently runs NT 4 on its desktop computers and about 50 servers, plans to move to Windows 2000 as soon as it ships.

Enterprise Appeal
Windows 2000 has a long list of new features that Microsoft officials say will dramatically improve its appeal as an enterprise computing platform. "You'll be hearing, again and again, two key themes: How we're taking NT 5 and reducing application deployment management costs, and how we're making it easier to build these distributed NT n-tier applications," CEO Bill Gates said last month at Microsoft's Professional Developers Conference in Denver. "That's where we see the biggest opportunities, and that's where NT 5 really comes into play."

Gates singled out Active Directory as one of the system's most significant new features. Active Directory--a global directory for tracking users, devices, and files on a network--replaces NT's high-maintenance, domain-based directory. Microsoft's customers agree with Gates. "The big thing for us is the directory services because it will make life a lot easier in a wide area enterprise network," says Mark Resh, CIO at Standard Forms Inc., a $400 million office supplies and forms supplier in New York.

Travelers' Beecher says Active Directory "lies at the heart of a solid security design, and administration of the directory is the part of ownership that is the most costly." About half of Travelers' desktops are in local offices across the country--and that doesn't include 7,000 or so agencies that sell its insurance products. Eventually, Travelers would like to provide transparent network access to many of those outside agencies, and a unified directory architecture would simplify that task.