US Computers Opportunity

There are two disconitnuities that are coming this year in the US. Companies (assuming the economy improves) would be seeking to upgrade their PCs, keeping in mind the 3-4 year upgrade cycle. Helping them along in this decision is the stoppage of support for older versions of Windows (other than 2000 and XP) by Microsoft in June. Forbes estimated that there are 200 million PCs in corporates worldwide still running the older Windows OSs.

I was speaking to a friend recently and he mentioned that a significant portion of the USD 199 Walmart PCs (running Lindows) are actually being bought not by consumers, but by smart CIOs, who are realising that they don’t really need new, Intel-PCs running Microsoft’s Windows and Office, and a cheaper Via-CPU and Linux-OpenOffice combo could work as well, saving them at least USD 500-600 in the process.

This set me thinking. If some corporates are willing to consider Linux desktops why not go further and look at a Linux-based thin client-thick server solution. This can help bring costs of hardware down even further – it should be possible to get desktops (excluding monitor) using Via CPUs for less than USD 125, since one can get rid of the hard disk and CDROM, and use a lower speed processor. Of course, this means an investment in a “thick” server, which could cost USD 1,000 for about 40 users, adding USD 25 per client. Thus, the additional saving is USD 50 or so per user, if one looks at 40+ users.

There are some other advantages to this approach. First, the cost of management of the desktops gets reduced dramatically since there is nothing to manage – all administration needs to be done on the server. Second, performance on the client is super-fast, since all processing is being done on the server. Third, clients never need to be upgraded.

Maybe there is an opportunity for Linux thin clients in the US and the developed world. As companies seek to upgrade their computing environments in the context of the two discontinuities, Linux on the desktop (through the server) may have its best opportunity in the US market.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.