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The Explorer /
Mike Elgan
Mike Elgan

Beware the Vendor Agenda
If you've heard any of these myths, don't believe 'em.

The bull can pile pretty high in this business. Hip boots and healthy skepticism are de rigueur for anyone who really needs to know what's going on.

Making and selling hardware and software is an ultrafast-paced business. The stakes are high. Companies stand to rake in billions or fail outright. Entire industry subsets can emerge and thrive overnight. Other product categories can be destroyed. We've seen it happen all too often.

Because the high-tech industry is standards driven, IBM and other companies invented FUD (fear, uncertainty and doubt). Here's how it works: If a competitor is talking about or shipping a product that stands to steal your customers, you announce a wonderful new product that sports every feature your competition delivers times two. (Whether you can actually deliver on schedule is irrelevant. The goal of FUD is to paralyze the market first, then worry about actual products later.) Customers will be afraid to buy the competitor's product (fear), will wonder whether they're making a mistake buying the competitor's product (uncertainty) or, if you're lucky, will decide your competitor has no chance of even surviving as a business (doubt)

In the '90s, FUD is a fine art. As products and companies proliferate, the products become more complex, more nontechnical people get involved in the industry, and FUD gets easier and more effective. That's why I decided to write this FUD-busting screed on the seven biggest FUD-induced myths now in circulation:

Myth 1: The NC will kill the PC. The Sun/Oracle/Netscape/IBM gang pits the NC against the PC to grab headlines and gain the allegiance of the sizable anti-Microsoft crowd. In reality, the NC isn't even designed to go head-to-head with the PC (see this month's cover story). Sure, there are people now using PCs who don't need their power, flexibility or extensibility. A recent Forrester Research report estimates that NC penetration will max out at about 10 percent of corporate desktops. NCs are great for information workers who don't need local storage, fast performance or customizability. But they're simply not designed to replace the PC for people like you and me (and probably Scott McNealy, Larry Ellison, Marc Andreesen and Lou Gerstner), who need more than the NC can provide.

Myth 2: The NC is a $500 device. When the pro-NC crowd first announced the new platform, it was dubbed the "$500 Network Computer." Classic FUD, that number stuck in the public's mind. But now that NCs are coming out from Sun and IBM, it turns out the "$500 NC" costs about $1,000 and up. Hmmmm. You can get a PC for less than that. And proponents rarely mention that NC networks often require costly unix servers.

Myth 3: The Net is dead. When Web mania hit, companies poised to strike it rich boasted of all the casualties of the Net-most notably other information-delivery media such as TV, radio, magazines and newspapers. The idea was that companies could set up sites that would attract Web users in droves, then sell ads.

But now the pendulum has swung the other way. Reports in The Wall Street Journal and elsewhere are sounding the death knell for the Net as an advertising medium. They cited some big-name pullbacks and labeled it a trend. Seems a lot of companies had jumped on board without understanding the medium. Instead of an information superhighway that could be strewn with billboards, they discovered a massive network of randomly placed dirt roads. But companies that do understand the Net are growing their advertising businesses. They're finding if you want millions to see your billboard, you have to build a Disney World to attract them down your particular dirt road. Some companies are failing, while others are succeeding.

Nonetheless, advertising on the Web is here to stay. No other medium provides the wealth of demographic data on viewers or the ability to tailor ads to a specific individual. It's literally a revolution in advertising.

Myth 4: Browsers matter. The browser wars are still grabbing headlines. Netscape is losing market share fast, dropping to 70 percent of the market from more than 80 percent just a few months ago. Microsoft's Internet Explorer has jumped from less than 10 percent to almost 30 percent in the same time. All other browsers are MIA. But who cares? Netscape cares because such a quick drop in market share tarnishes its golden aura. And Microsoft cares because it wants to condition users and prepare them for the new browser-enabled user interface to Windows 97 and the next version of NT. But to the rest of the industry-and more importantly to you and me-the browser wars don't make any difference. Microsoft is coming out with IE4 and Win97, and Netscape is moving on to its own cross-platform, browser-enabled user interface. We're back where we started: The important battle is between operating system vendors and companies (like Netscape) that will provide alternative user interfaces.

Myth 5: Netscape is toast. Netscape used to be the industry's darling because it made the best browser. Now people casually assume the company is going to die because Microsoft is starting to beat Netscape at the browser game by spending millions on developing and promoting a product it's giving away. (See Myth 4.) Netscape is a solid and fast-growing company; it sold 1 million server licenses last year. Its future is bright, and there's no reason to think otherwise.

Myth 6: Novell is dog meat. Reports of Novell's death have also been greatly exaggerated. When people see Windows NT Server with three-digit projected growth every year for the foreseeable future, they assume NetWare will lose and die. In fact, there's a huge demand for NetWare as a bona fide network operating system that securely links entire enterprises with its global directory and administration features. Novell expects 8 million servers to be running NetWare by the year 2000, twice the current number. NT also has a role as a server operating system, dishing out applications and acting as the server for large departments. The two will live side by side and serve different purposes.

Myth 7: NT will replace Win 9x on corporate desktops in 1997. NT is hot, but the common belief that NT Workstation will replace Win 9x on corporate desktops in the near future is based on some false assumptions. NT used to require far more hardware (three or four times the RAM, twice the hard drive space) than mainstream Windows, and it didn't make sense to run Windows on a costly system geared to NT. But now, a typical, low-cost Win95 machine is a fire-breathing monster with a 200MHz processor, 32MB of RAM and a 2GB hard drive. Second, NT Workstation offers many advantages (provides security, works on Mips, Alpha and PowerPC, can access up to 4GB of RAM and so on), but Win95 is easier to install, use and maintain. Win95's Plug-and-Play, high backward compatibility and ease of use-not to mention its much lower purchase price-can save companies a bundle. And finally, one of the biggest growth areas for hardware is in notebooks. Win95, with Plug-and-Play hot docking, lower hardware requirements and power management, is a far-better deal for notebooks. NT installations will grow faster than Win 9x over the next few years, but 9x will remain the dominant OS.

Did I miss anything? Drop me a line and share some myths you've heard lately.

Contact editor Mike Elgan in "The Explorer" topic of WINDOWS Magazine's areas on America Online and CompuServe, or at the e-mail addresses here.

Windows Magazine, April 1997, page 41.

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