The NetPC is not a bridging product, says Microsoft New Zealand marketing manager Steve Jenkins. Research company IDC said last week the sole purpose of the Net PC was to divert attention from the network computer.
Jenkins says that Microsoft is unlikely to spend time and money on researching a product that is not going to show a return on its investment.
Sean Kaldor, director of worldwide quarterly PC market tracking at IDC, says the object of the NetPC is to confuse the market and give the Wintel empire time to get PC prices down and build low cost-of-ownership features into regular PCs. The NetPC concept — the brainchild of Intel, Microsoft and several major PC vendors — promises sealed, thin-profile PCs. With their Zero Administration Windows software, the NetPCs are billed as easy to deploy and as offering a lower total cost of ownership than their full-blown PC brethren.
“Essentially we see the Net PC as a product which exists as a result of consumer demand,” says Jenkins. “Yes, we are in competition with network computers, but our research suggests that clients are keen to use a Windows-based environment.” IDC forecasts that, worldwide, no more than 200,000 units will ship this year.
“The NetPC is never going to replace the PC,” says Jenkins; “But it will certainly be viewed as a supplement to the PC.”
Despite the initial hoopla, vendors have recently admitted that they do not expect high sales of the machines. Managers at both Hewlett-Packard and Compaq — two of the original promoters of the concept — have expressed their reservations about prospects for the devices. Analysts say the real achievement of the movement is to focus the market’s attention on PCs following major promotions by many computer industry players of low-cost PC alternatives such as Oracle’s NC and Sun’s JavaStation.
Because no vendors are setting up NetPC divisions, IDC says it believes that the companies will subsume the concept — a PC with a sealed case — in their PC line-ups as an option for customers.
IDC expects the PC community to pursue its counteroffensive against the NC threat with ever-cheaper PCs. Vendors are beginning to integrate lower cost processors from companies like Cyrix into their machines as a step toward lower prices, analysts say.