Can NEC's Virtual PC Center Make Thin Clients In?

NEC Corp. (NIPNY) thinks it has found a way to finally usher in the era of thin clients–bring enhanced multimedia capabilities to the devices.

We know. Thin clients have never been in. They have some limited uses, but for the most part thin clients have reportedly been on the comeback trail for a decade–I've even written my share of thin clients are back stories. And they never come back.

It's so bad that even the words "thin" and "client" have a negative connotation when put together.

Good thing NEC is dubbing its effort the Virtual PC Center.

NEC's pitch: The Virtual PC Center combines a thin client and server that can deliver the multimedia experience you get with a PC. Ken Hertzler, director of the Virtual PC Center product line at NEC, says multimedia has limited thin clients.

For starters, multimedia delivered over a network hogs bandwidth. Meanwhile, users balked when they couldn't do what they usually do with PCs. "Thin client networks have been sapped by multimedia," says Hertzler.

NEC's approach is to put decoders and graphic capabilities into the thin client. That way multimedia content–corporate video, training material, VOIP and messaging–is decoded at the thin client instead of the network. By decoding data at the desktop bandwidth and computing power is conserved.

NEC's first target market is the financial services sector, which needs multimedia capabilities before installing a thin client. After all, current thin clients can't handle Bloomberg video and CNBC.

Hertzler says that the Virtual PC Center is part of NEC's effort to become better known in the U.S. NEC is one of the largest IT providers in Japan, but only 25 percent of its sales are international to places like the U.S. and Canada. NEC does do private label servers for U.S. hardware vendors.

So is it time for a thin renaissance? Maybe. The arguments for thin clients–easier management, centralized protected data, more efficient upgrading procedures and security–are all legitimate.

Hertzler also has a good economic pitch. NEC estimates that the total cost per ownership TCO for a desktop user is $4,552 over three years. That sum includes employee time, maintenance, hardware, software, personnel and help desk costs. NEC reckons it can get that TCO down to $3,185 over three years largely due to lower help desk costs and employee time savings. NEC's figures are culled from analyst firm estimates.

NEC's payoff is selling you the servers and thin clients with the associated software. The thin client–called the US100–has a Windows XP environment on its system-on-a-chip design. VOIP integration and graphics and audio support are embedded. As far as costs go, NEC says installing a Virtual PC Center setup is about the same as refreshing your desktop PCs. The return comes from lower bandwidth costs, more efficient computing and support savings.

Will that be enough to make thin in? Perhaps, but we've heard the thin client mantra before. 

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