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NCD to 'cease operations'

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Exclusive One of the older thin client vendors appears to be closing shop, The Register has learned. Network Computing Devices (NCD) will stop all operations by year end, according to a company memo. Calls to NCD's CEO and CFO were not returned, and a spokeswoman said the company has no comment at this time.

"NCD is currently in the process of ceasing operations," the company said in a memo to workers obtained by The Register. "The company will close operations on December 31, 2004."

The US company seems to have a skeleton staff at the moment. Calls placed to NCD's main line, technical support line and customer service line were all greeted by answering machines.

In February of this year, NCD worked to consolidate its European operations as a cost-cutting measure.

NCD started way back in 1988. Some of its earliest products were thin client terminals designed for Unix users. Later, NCD developed a Windows-based client running Microsoft's Windows CE operating system. It currently makes a variety of hardware and software products in its ThinPATH line and has offices in the US and Europe.

The thin client remains one of those great computing ideas that never really took off. Unlike PCs, thin clients typically ship with a minimum set of innards. They simply connect back to a server. This means the client on a user's desk is typically smaller, cooler and more quiet than a regular PC. Advocates of the thin client also argue that it's cheaper and more secure to manage clients from a server as opposed to rolling out software updates to myriad individual PCs.

Sun Microsystems is the last of the big vendors really pushing the thin client idea. A number of others, however, do now offer clients that connect back into a blade server that functions as a PC, which is a similar attack. Sun has recently been talking about possibly having service providers give away its thin clients to users for free in exchange for ongoing software subscription services. This model is similar to phone companies that give away or subsidize the cost of mobile handsets.

NCD enjoyed a large amount of press back in 1998 when thin client hype was particularly high. It shared product development with the likes of Intel and IBM and secured strong endorsements from Microsoft. Its X Terminal products were particularly popular for a time, but the firm steadily lost market share.

Most of NCD's current hardware sales go to Europe with it focusing on software in North America. Competitor Wyse Technology estimates that NCD sold less than 900 thin clients in Europe last quarter.

"They were playing a very small role," said Jeff McNaught, vice president of communications at Wyse.

Wyse remains optimistic about the thin client market despite NCD's apparent problems. IDC predicts the thin client segment will grow much faster than the PC market in the coming years. Close to 400,000 thin clients were sold worldwide in the third quarter of this year. ®

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