As the government is pressing to break up Microsoft, many in the computer industry say a new generation of Internet devices could overtake the PC in just a few years, making the monopoly crumble on its own.
Several companies are preparing or have launched so-called "Internet appliances" -- streamlined computers that access the Web without bulky hardware and software -- that will cost only a few hundred dollars, and in some cases are being offered free.
If this trend develops, it could mean an end to the dominance of Microsoft and its Windows software platform used on most PCs, say analysts.
We've heard this before. In 1996, a group including IBM, Oracle and Sun Microsystems announced plans for a 500 dollar "network computer" that was touted as a means of challenging Microsoft and the PC.
Although the "network computer" failed, the rapidly changing tech landscape has made these devices more practical.
International Data Corp. recently predicted that the worldwide market for information appliances will top 89 million units, or 17.8 billion dollars, by 2004.
IDC says sales of information appliances -- which includes desktop devices as well as handheld computers and wireless phones -- will overtake PCs in the United States by 2002.
"The potential is awesome, the sense is that Internet appliances are someday going to outsell PCs," says John Spelich, spokesman for Gateway, the computer maker planning to market a new Internet appliance later this year in cooperation with America Online.
"We do see a potential around the world," said Shannon Burris, a spokeswoman for Intel, which plans to launch its own Internet appliance later this year with various partners.
"The PC is like a Swiss army knife, you can do a lot of things with it; with the appliance you can do a few things like use the Internet and send email."
Intel and others plan to distribute their Web appliances through firms that may subsidize it as part of a marketing effort. Virgin Entertainment Group, for example, is distributing some 10,000 Internet appliances as a way to promote its online shopping and music sites.
Intel and Gateway decided to use the Linux operating system instead of Windows for their desktop appliances.
Netpliance, which has been selling an Internet appliance called the i-opener since November -- for 200 plus 22 dollars a month in access fees -- uses operating software made by Canada's QNX, featuring a "pizza button" that instantly connects users to local pizzerias.
Easing the transition for PC users will be the growth of "applications" or software on the Internet where they can store and manage data and documents. Several studies show the market for so-called Application Service Providers (ASPs) will be worth more than 20 billion dollars by 2003.
One such service, MyInternetDesktop.com, offers users a 100 megabyte "virtual hard drive," as well as word processing and other applications.
All this means the Windows monopoly that became the focus of the government's lengthy antitrust case could be crumbling on its own, say some analysts.
"This market is moving very fast," says analyst Simon Yates at Forrester Research.
"I would argue that the stranglehold (of Microsoft and Windows) on the market is already being released by non-PC devices. There are all kinds of challenges being brought to Microsoft by the Web, where they are not the dominant player."
Microsoft has been trying to become part of the Internet appliance market with Windows CE and other variations of its software, but Yates said "unfortunately, Windows is not well designed for this."
Yates sees a changing model for the computer industry as more data and software go to the Internet. This, he argues, makes it easier for many users to update their systems without buying a new PC every two years for 2,000 dollars or more.
"You will cut the costs out of the front end," says Yates. "It's like leasing a car. You will may monthly access fees and subscribe to different applications."
Microsoft spokesman Mark Murray said the changes in the market show flaws in the government's antitrust case.
"The incredible growth of Internet appliances ... undermines the government's central allegation that Microsoft somehow dominates or controls the evolution of technology," Murray said – (AFP).
© 2000 Al Bawaba (www.albawaba.com)
