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March 6, 2000

Thin Clients Tapped In Times Of Change
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"Thin clients enable us to attack the labor shortage of technical people," Thompson says, "and we provide better service to our customers. We don't have things that go down very much or stay down very long if they do go down." Because all tech-support people are in one place, it's also easier and less expensive to update their skills, he says.

Windows 2000 will make thin clients even more attractive to companies such as First Community. "With NT, you have to basically buy a separate product for Windows Terminal Server and modify your applications," says Shawn Willett, a senior analyst at the Aberdeen Group. "With Windows 2000, it's going to be automatic."

The advent of ASPs is already making thin clients more attractive to some businesses. "The ASP model and thin clients were meant to be together," says Cori Fountain, owner of Planet Computer Inc. in Denver. Fountain's clients use IBM Network Station Series 300s, which they can lease from the company as part of an overall service contract or purchase for $500 to $700 each. Planet Computer, which caters to small and midsize businesses, hosts a range of applications, such as contact-management products, software specific to vertical users (including human-resources personnel), and custom apps, as well as back-end databases, for a monthly fee that includes support services.

All the customer needs to be up and running, Fountain says, is the thin client, a router, and a hub. The clients have a long life expectancy and almost no maintenance. "We set up the thin client prior to shipping, and the client just has to plug in the power and the Ethernet connection," Fountain says.

Gloria Kellerhals, owner of the Westminster Group, an eight-employee executive search firm in Westminster, Colo., is a Planet Computer customer. The Westminster Group once issued each employee a full-fledged PC, but Kellerhals was eager for an alternative. "Every time I bought a PC, it seemed like the latest and greatest would come out shortly afterward and I was behind the technology curve," Kellerhals says. Maintaining the systems was another headache. "If I'm fiddling around with my technology, I'm not making any money," she says.

The cost of a staffwide system upgrade--including $20,000 for a new server--was the last straw. Planet Computer now houses all of Kellerhals' software and provides technical support for Westminster Group's thin clients. The company pays $45 per month per user--about $4,300 a year. Kellerhals says performance hasn't declined as a result of going to the ASP model.

Gloria Kellerhals Photo by Ray Ng Rob Enderle, a VP at Giga Information Group, agrees that thin clients are gaining ground because of the ASP model. "You get rather significant economies of scale off the desktop to centralized servers," says Enderle. And he says he expects to see more ASPs begin offering bundled options of thin-client hardware with their services.

Still, not everyone is convinced thinner is better. Paige Martin, manager of LAN and desktop management at International Paper Co. in Purchase, N.Y., says she looks at thin clients about once a year, but has yet to bite. "The PC price has gotten so reasonable there is no reason to pursue the topic," she says.

Thompson at Community First admits the thin-client model has shortcomings. Not all application vendors support the environment, he says, or even know much about it when they do. "You have to explain that it's an emulation of NT 4.0 but is not NT 4.0. Most are compatible with Citrix, though they don't know it," he says. And while Citrix works well with most products, he says, sometimes an application's code doesn't perform appropriately under the Citrix emulation, and the application maker doesn't realize this because it hasn't tested its product with Citrix.

Others simply wonder what all the fuss is about. "We've had low-end thin clients for 40-some-odd years; they are terminals," says Steve Kleynhans, VP of workgroup computing strategies, at the Meta Group. "There have always been low-end devices, but we're noticing it now because they're changing the architecture of that low-end device."

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