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. Last Updated: 07/27/2016

Microsoft Network PC: Still in Avoidance Stage?

The computer industry lives in a state of constant revolution. There can be few industries where large firms must undergo such contortions just to stay in business.

According to Intel Corp. chief executive officer Andy Grove, the computer companies that flourish are the ones that are able to most successfully dissolve and reform themselves to mirror the molten state of the whole industry. In his book "Only the Paranoid Survive," Grove describes the moment when a company is forced to undergo a major change in its corporate direction. The need for change is first denied, then people try to avoid it, it is then recognized, and finally action is taken to put the company on the right road. Grove names this moment a Strategic Inflection Point, or SIP.

Watching Microsoft over the last six months, it is obvious to me that the world's largest software company is undergoing the strain of Grove's SIP. In 1995, Microsoft declared that the Internet was too amorphous to be taken seriously as a way to make money. Along with Windows 95, the company launched the Microsoft Network -- an online service effectively competing with the Internet.

Then Microsoft realized it had been wrong. Armies of employees were drafted from other divisions to develop Internet products. Today Microsoft is targeting the Internet with everything it publishes.

However, an announcement by Microsoft last week makes me think this transition is still far from over. Last Monday the company launched the blueprints for what it calls a new generation of "network computers" -- the NetPC Reference Platform.

The Microsoft NetPC requires an Intel Pentium processor running at 100MHz or faster, with at least 16MB RAM, Windows device drivers and support for its so-called plug and play specification, audio, and video capabilities. In short, what it amounts to is a description of an average Windows PC in use today.

The attraction of a network computer is that it saves money. Since the Internet is now so pervasive, if your network is based on the emerging Internet standards you will be able to connect with virtually anyone. By increasing the flexibility and functionality of your company network, you will need to give each user much less hardware, and virtually no software. Rather than having thousands of dollars worth of hardware and software at each desk, most of it can reside on a network and be accessed using a low cost purpose-built device. The added benefit of this is that these network computers are simpler than a PC and are attached to an intelligent network. Thus most problems can be fixed by a few engineers sitting at their desks rather than by an army of technical support staff roaming the corporate corridors.

The closest tangible product we have that realizes this idea is the SUN Microsystems JavaStation Network Computer, which was also launched last week. All of the software for the JavaStation is stored on the server. The JavaStation costs from $742 with 8Mb RAM, keyboard and a mouse (but no monitor).

Whether or not the concept of a network computer really is viable (and I still have my doubts), the SUN JavaStation is something genuinely new. Microsoft's NetPC is like taking a cow, giving it a pair of false ears and calling it a rabbit. If part of Microsoft's strategy to meet the challenge of the Internet is to simply change the name of the PC, then perhaps it is still in Grove's "avoidance" stage. Or maybe those canny folks at Microsoft realize they simply need to make enough Internet-related noise until the fashion for all-things-Internet fades.

Robert Farish is the editor of Computer Business Russia; fax: 929-9958, e-mail: