Net Appliances Seek Home

SAN MATEO (06/30/2000) - Internet Appliances, or IAs, those legacy-free devices aimed at users looking for Internet access and limited functionality without the overhead of a full-blown PC, are still trying to find their niche in the computer market.

A number of vendors were showing off IAs at PC Expo in New York this week but differed on whether consumers or enterprises would be the primary customers.

IBM and Intel each had their IAs on display, but the recently discounted SunRay IAs from Palo Alto, California-based Sun Microsystems Inc. were nowhere to found. The jointly branded America Online Inc. /Gateway 2000 Inc. IA, which runs on Santa Clara, California-based Transmeta Corp.'s Crusoe processor, could be viewed only by members of the media.

"We don't want to give the wrong impression to people as far as what the final version of the device will look like," said Gateway spokesperson Ruth Rosene.

Rosene said Gateway, based in North Sioux City, South Dakota, is also waiting for applications that are being developed by America Online, which will act as the service provider for the devices, expected to be available by late December.

Sun, meanwhile, will demonstrate its SunRay IAs to more specific audiences, such as the hospitality industry, where it feels the products will be readily adopted, said Brian Healy, the group marketing manager for Sun's IAs.

"The potential is there for [IAs] to become the ubiquitous client used by everybody, but we're concentrating on the here and now," Healy said. Healy believes IAs have great potential as they require no upgrading and "are as powerful as what you have on the back end," meaning the server.

Santa Clara, California-based Intel Corp., with its recently announced Intel Dot.Station, believes the Internet appliance space will be primarily consumer-oriented, according to Craig Miller, the director of marketing and business development at the company's home products group. Intel is using the device primarily to promote its suite of Network Management Software, as well as Intel itself.

IBM Corp., on the other hand, feels Internet appliances have a significant future in the enterprise market, according to Edward Petrozelli, the vice president of marketing at IBM's desktop and Net devices division.

IBM's IA program has had enterprise roots from the beginning, with trial launches involving Fortune 500 companies such as the Fidelity Investment/Lycos/IBM trial run, which took place earlier this year.

Petrozelli predicts an explosion of devices as broadband becomes more readily available to the homes of consumers, giving the Armonk, New York-based company a two-pronged strategy.

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