Dataquest foresees stronger Apple sales, mild interest in NCs

Apple is positioned to sell plenty of computers in the next two years, but there is unlikely to be a stampede towards the network computer, according to market researcher and technology analyst Dataquest.

Apple is positioned to sell plenty of computers in the next two years, but there is unlikely to be a stampede towards the network computer, according to market researcher and technology analyst Dataquest.

At Dataquest Predicts: 1997 and Beyond, a conference for large-scale deployers of computers and networks, the firm offered a few surprises amid dozens of predictions for the computer industry through the end of the decade.

Casting off a rising tide of criticism of Apple, W. Ladd Bodem, worldwide director of Dataquest's IT services group, said the Cupertino company should sell a lot of computers in 1997 and into 1998.

"We looked at the numbers," Bodem said, and found that Apple has reversed its price-performance equation to offer a lot of computing power for the buck. The company recently cut prices and offered new products with faster processors.

Industry star Intel, however, will get a run for its money by Pentium chip cloners and may hold on to only about 50% of the market for Pentium-class sales in 1998. Consequently, chipmaker Advanced Micro Devices Inc. will "have a hot 1998," predicts Dataquest.

The recent advent of the US$1000 PC will work against any mass migration to the thin-client, network computer, said Bodem, at least through this year. Dataquest believes the cost of a full-fledged PC will continue to drop and that users will want the local power and storage of a PC. Although lacking a compelling price point against PCs, NCs will nonetheless take the place of terminals, but Dataquest doesn't expect that will change the overall PC landscape.

In fact, Dataquest predicts continuing heady growth - a rate of 17.5% from 1996 to 1997 - for the worldwide PC industry, with especially high growth rates in Asia. In the US home consumer market, growth will slow and peak at a penetration level of 36% of households and then retreat slightly over the next few years, said Dataquest.

Gigabit Ethernet products will arrive to quench the thirst for bandwidth on local area networks this year, Dataquest predicts. And the old "80/20" rule of network traffic, wherein 80 percent of network traffic is local and 20 percent backbone, will be inverted in 1997, the result of centrally deployed intranet servers.

Other predictions made here yesterday by Dataquest include the following:

• Netscape Communications' browsers will remain the Web client of choice in intranets due to the multiplatform versions of the Navigator product line.

• Expect the rapid development of new software delivery channels such as distributed objects and "push" technologies.

• More than half of all software support transactions will be conducted online by 1998.

• The concept of a "computing utility" will emerge - a new twist on the old time-share computing model - in which businesses and users will buy computing services without owning any hardware. Such services will grow to 30 percent of the IT market by 2000.

• Software application suites will become increasingly customised to satisfy more vertical markets.

• Expect more than 140 million PCs on the Internet by 2000.

• More than half of all Web servers will be on intranets by 2000.

• Online commerce, with the lion's share in business-to-business transactions, will become a gold rush in 1998 and blossom to $12 billion in total transactions by 2000.

Dataquest, in San Jose, California, is at http://www.dataquest.com/.

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