Reinventing the desktop

If today’s desktop was compared to a car, the best choice would probably be a Ford Model-T – functional but not very colourful.

As one industry analyst likes to point out, Henry Ford was famous for saying you could have the car in any colour – as long as it was black (in the desktop’s case, beige). Then Alfred P. Sloane of General Motors revolutionized the automobile market by offering a wide range of colours and designs. Now, with the introduction of the bottle-green iMac, Apple Computer Inc.’s Steve Jobs may become the Sloane of computing.

“Style and design, in every other market, is an important differentiator. There’s no reason why that shouldn’t happen with computers,” explained Carl D. Howe, director of computing strategies services at Forrester Research in Cambridge, Mass. “I think there will always be a PC, but it will look different.”

Most industry observers agree that the general-purpose machine will not go away entirely — it’s just too useful for too many things. But this doesn’t change the fact that today’s desktop form factor, with its big rectangular box and numerous cables, is not very well designed for the office environment. One big reason for the iMac’s popularity is that it eliminates a lot of the wires and cables, and the iMac is definitely not beige.

Many would argue computer colour and style are targeted solely at home users, and would have little or no effect in an enterprise market. Howe disagrees.

“Serious business people are not immune to pizzazz. Just look at all the executives running around with thousand-dollar pens in their Armani suit pockets,” he said.

Howe expects to see a “mini-boom” in the PC industry fuelled by Y2K. But by the second half of next year, many companies will lock down their desktops and the market will end up in a major slump because corporations “don’t want to screw up the $300 million they just invested in Y2K,” Howe said. This will lead to a drop in PC prices, supply and demand divergence, and will necessitate inventive marketing strategies and design changes – resulting in an increase in the “coolness” factor.

“In a declining market, the only way you can grow is by taking share away from somebody else. So you are basically in cannibalization mode – your principal weapon is price,” he said.

Processors are getting faster all the time, but this is not enough to draw a significant number of new customers any more. Not everyone within the enterprise space needs all the power. And PCs are no longer competing with themselves for market share.

In 1997, PCs accounted for 96 per cent of all devices used to access the Internet in North America, according to a recent International Data Corp. report entitled Death of the PC-Centric Era, compiled by analyst Frank Gens. But in 1998, Internet growth drove the development of new user-access devices such as Web TV, Web-enabled telephones, PDAs, handhelds and video-game consoles. IDC predicts these non-PC devices will account for nearly half of unit shipments by 2002, thereby driving down the PC market share significantly.

“The era of PC dominance may be nearing an end, as the explosive growth in users and uses of the Internet expands device requirements well beyond the design point of the general-purpose PC,” Gens states in the report.

Following this shift in the marketplace, appliances are expected to exceed the PC unit shipments by 2005. Although the PC market will continue to grow, it will dramatically lose share to new access devices. The IDC report predicts that vendors who don’t invest in the small but expanding market of these new devices will find themselves boxed out of the fastest-growth area.

Linley Gwennap, Sunnyvale, Calif.-based publisher of the on-line hardware magazine Microprocessor Report, said vendors are working on ways to make PCs more “natural” to use, including speech recognition and 3D user interfaces, allowing for more specific markets to emerge.

“The market is growing so big that it really makes sense for companies to focus on particular segments. Even though the mobile market is about 20 per cent of the whole PC market, it’s bigger than the entire PC market was five years ago.”

Mobile devices and other specialized products – although popular – will never overshadow the PC in the enterprise, Gwennap believes.

“In the corporate world, I don’t see people wanting to commit a lot of IT dollars to some device that just isn’t as flexible as a PC,” he said. “You never know what kind of new applications people are going to want to run.”

And even though PCs dominate, there is a trend toward a thinner client, with more server-based software control and browser-based access. With this leaner version in mind, some vendors are opting for a compromise in the form of Net PCs, such as those offered from Compaq and Packard-Bell NEC. These stripped-down versions of standard PCs come in sealed, tamper-proof cases but offer a processor and local storage for caching or storing data. Except for a single PCI slot, Net PCs offer no expandability options, floppy drives or CD-ROM drives, thus preventing end-users from adding unauthorized software, files peripherals or viruses.

An alternative to these are Managed PCs, available from many vendors including IBM, Gateway 2000, Hewlett-Packard and Dell. These are very similar to Net PCs from a management standpoint but have the flexibility and power of standard PCs.

Tormi J