THIN CLIENTS - Saints or thinners?

Thin client sales suggest the industry is nearing a thin or lose situation. Tony Dennis reports from Thinergy '98, where Microsoft's licensing policy came under attack - again.

Thin client computing, previously seen as a quiet, specialistose situation. Tony Dennis reports from Thinergy '98, where Microsoft's licensing policy came under attack - again. backwater of the networking world, has reached a milestone. At the Thinergy '98 conference in Florida, Citrix revealed the number of concurrent user licences for its independent computer architecture (ICA) protocol has doubled to two million in less than a year.

As it comes of age, the thin client sector has also just generated its first significant controversy. At Thinergy, attendees attacked Microsoft's pricing strategy, which concentrates on requiring licence revenue on a per PC basis rather than a connected user basis.

Microsoft will have to face up to this challenge if it is to seriously push Windows NT as the operating system for the Lan and networking sector against products from the likes of IBM, Sun and Oracle. Furthermore, UK resellers that continue to ignore thin client computing may soon be kicking themselves.

Citrix's ICA is the underlying technology of its WinFrame and MetaFrame products. ICA first came into existence in 1995, so recent sales should give an idea of just how rapidly thin client computing is gaining momentum.

Ed Iacobucci, chairman and chief technical officer at Citrix, believes the ICA installed user base exceeds that of X-Windows terminals. To put the sales figures in perspective, he claims the two million translates to more than eight million individuals who could potentially have access to ICA.

The difference between the two figures - eight versus two million - is explained by the fact that following well established practice in the Lan and networking sector, Citrix - like most other network specialist vendors - only charges its customers for the number of users using its product simultaneously over the network.

A firm's Lan might, therefore, have 30 PCs fitted with network interface cards scattered around the premises but, at peak times, only 15 individuals have switched their machines on and are using the Lan. In practice, therefore, the organisation only requires a 15-person concurrent user licence. If a 16th person needs to use the network, the system manager is faced with the choice of either disconnecting somebody from the Lan or paying more for a 20-user licence.

This traditional mode of operating had some rather unexpected repercussions at the Thinergy conference. The incident that sparked the controversy was a paper delivered by Bob Carter, chief technology officer at global courier FDX (known in the UK as Federal Express). He was describing how thin client computing can be implemented on a large scale by large corporations, not just for peripheral applications but also for critical systems.

Carter's task is not an easy one. He has about 60,000 machines connected to the company's existing network - a blend of Macs and PCs running Windows 3.1, plus a number of X-terminals running legacy 3270 IBM mainframe applications.

Worse still, the machines are scattered across 1,200 locations. He maintained that if he had decided to follow the conventional route - Windows 3.11/95/98 connected to NetWare servers, for example - he would have been faced with the prospect of replacing his users' desktop hardware twice every five years on average.

With the thin client computing model, Carter is able to centralise all his applications around a number of hot servers (server farms) running a mixture of software from different suppliers. For example, the company has Windows NT 4 Terminal Server Edition to provide the basic thin client server environment and Citrix's MetaFrame to provide the load balancing on its server farms to ensure user demand for resources is spread evenly across the servers. Carter also revealed he is introducing network PCs supplied by Wyse and Hewlett Packard, which are living alongside existing DX2 486 machines and all running thin client software.

An important consideration for FDX is that by following the thin client computing route, it does not have to abandon existing legacy systems.

'Our crown jewels is the data still held on the mainframe,' Carter said, maintaining that the mainframe is still 'the right tool for the right job and it can run some pretty big databases.'

But the most interesting statistic Carter revealed concerned the ratio of networked PCs to servers. He had found that a ratio of 30 connected devices to each server processor worked fine and estimated that of those devices, only half would ever be concurrent users.

This brought him to the topic of licence metering, a means whereby corporates pay royalties to software vendors depending on actual Lan usage, rather than on a machine-by-machine basis. By metering, a corporation wouldn't have to buy one licence for every network user for PowerPoint regardless of whether they use that package.

Carter hinted the relationship between large users and certain software vendors might have to change as a result. 'Today we go through Vars, but licence metering is not a Var model,' he said.

Speaking directly after Carter, Citrix's Iacobucci deftly avoided the issue by suggesting his company was looking at ways to help its resellers deal with the problems of servicing large corporations whose operations were globally dispersed.

Carter revealed, however, that he was extremely unhappy at the prospect of eventually having to pay Microsoft an NT licence for every employee in his company - about 140,000. 'Am I going to do so? I think not,' he told the audience, adding that he calculated only 70,000 machines would be used at once.

The root problem is that Microsoft is insisting every client that connects to an NT server requires an NT workstation licence plus an NT client access licence. Corporates that bought into thin client computing and network computers as a way of cutting escalating costs are now faced with the prospect of paying hundreds of dollars per PC to Microsoft.

It was left to Solveig Whittle, NT terminal server product manager at Microsoft, to face the wrath of Thinergy's attendees. She was forced to admit: 'We don't have any plans to change our model at this point.' But she added Microsoft had a number of different licensing schemes and was looking at ways of converging them.

One Thinergy attendee was Graham Crich, sales director at reseller Ikon Office Solutions. Asked whether he felt Microsoft's licensing policy for NT Workstation was affecting this sector's expansion, he told PC Dealer: 'Definitely. Whether Microsoft is right or wrong, its policy has created a lot of fear and confusion which has delayed sales.' He added: 'People are losing sight of the fact that they can continue to run pure Citrix WinFrame and don't need to run NT Terminal Server Edition.'

Jay Savoor, an exhibitor from Stockport network PC manufacturer VXL Instruments, sounded a more optimistic note: 'At first, I thought this would have a significant impact. It did, but as we suspected, Microsoft is dropping the pricing of the NT Workstation licence. In any case, those customers who see the value in thin client technology will not be distracted by the pricing of NT Workstation.'

Iacobucci claimed not to be phased by Microsoft's tactics. He said he welcomed the competition - in terms of NT Terminal Server and its associated remote desktop protocol (RDP) - because he believes it has helped to validate a market in which Citrix operated solo for some time.

Although Thinergy '98 was directly sponsored by Citrix, the event attracted broad industry support that took it beyond being merely a vehicle for Citrix products. In fact, it was more like a mini Comdex.

All the big industry players participated in some manner - Compaq was there to promote its hardware to resellers and users as the obvious choice of server for thin clients; Novell was there to illustrate how its own products, in particular its network management tool such as ZenWorks, fitted into a thin client computer environment; and there were a large number of terminal vendors, such as Tektronix, Boundless and Hewlett Packard, whose hardware is intended for the client end of the connection.

VXL was the lone representative of UK hardware suppliers but Savoor was positive. 'We foresee installing at least 20,000 desktops by the end of next year in the UK alone,' he said, adding: 'The market in the UK is probably going to be on a par with Germany in terms of installed desktops.

We can target those customers who wish to hang on and use their legacy PCs.'

Intriguingly, the search for the ultimate thin client has had some amazing side effects. Would you believe Dos is back? Those with good memories may recall ICL favoured Digital Research's DR-Dos over Microsoft's rival product for many years and the rights to DR-Dos have ended up with Caldera, a startup founded by former Novell chief Ray Noorda.

Not only did Caldera announce the availability of DR-Dos with an ICA client at the conference, but it also announced the formation of a wholly owned subsidiary, Caldera Thin Clients, which will form Caldera's vehicle to chase the internet/TV set-top box and smart phone markets.

It just so happens that Caldera's research division, the former Digital Research operation, is located in Andover, Hampshire and Roger Gross, a Brit who is chief executive of Caldera Thin Clients, spends his time commuting between Andover and the US. Gross' 15-strong team comprises many former Digital Research employees: 'Because with them, the learning curve is less steep, rather than it being a case of hiring all my old cronies,' he joked.

Caldera has set up an office in Taiwan and is turning its attention to the European market. Gross attributed the current success of DR-Dos as a thin client to the fact that it can run on a variety of platforms including legacy hardware, such as a 386 PC with 4Mb of memory and within 4Mb of flash memory or disk space.

Another British participant at Thinergy was Acorn, a former UK giant that has drastically changed its image and focus. Rather than demonstrating its own product, Acorn was helping to show off what it terms its 'reference design model' for what Steve France, senior marketing manager at Acorn, described as 'the lowest cost thin client design'.

Acorn's work was showing on the Boca Research stand in the form of the WT120, an ethernet-based thin client terminal running Citrix's ICA. Boca and Acorn are aiming at a sub-$200 price point for such products, but Gross maintained the price will have to fall below $99 to compete against Risc-based products.

Asked whether he thought the UK was lagging behind North America, Crich replied: 'From talking to colleagues in the US, I think they are working on similar size projects, but one surprise was the number of people who had already launched Terminal Server Edition in some fairly major sites.'

He added: 'We have found that awareness is one of the main issues. Most corporates just do not know about thin client computing. The level of publicity that companies, such as Citrix, have in the US is dramatically larger than in the UK or in Europe. This is increasing, but not at the rate it should.'

Savoor partially disagreed, citing the fact that Bull has just landed a large thin client contract in the UK and feedback from his French contacts that demand for MetaFrame had just gone through the roof. 'Users were waiting for things to settle down and become clear. Now they're happy enough to go ahead,' Savoor added.

From a European perspective, the most glaring omission at Thinergy was a lack of focus on smart (GSM) phones as one of the most likely applications for a thin client. This is almost certainly due to the fact that Europe is still way ahead of the US in terms of introducing digital mobile networks.

However, the opportunities for thin client computing in the UK are definitely there. According to Ikon's Crich: 'Integration with Oracle applications is another area that is creating a lot of interest at the moment. Oracle tends to be bandwidth-hungry and ICA overcomes this problem.'

So expect to hear more, not less, about thin client computing in the near future.