IBM forms unit to sell so-called NCs Network computers are stripped-down PCs


ARMONK, N.Y. -- International Business Machines Corp. said yesterday that it had formed a unit to spearhead efforts to sell its stripped-down personal computers.

Creating the independent unit underscores the importance IBM is placing on so-called network computers, which are targeted at customers who need specific functions -- such as hooking into the Internet -- instead of the broader capabilities of regular PCs.

"Customer interest in our NC initiatives has been extremely high," IBM Chairman Louis V. Gerstner Jr. said in a statement. "Customers are looking for solutions that lower the cost of desktop computing and provide access to networks."

Network computers were conceived to reduce the costs of managing a regular PC, which sells for up to $9,000.

Network computers generally cost less than $1,000 and have no hard drive or disk drive.

A network computer would be linked up with a central server that would house all the applications and distribute data to each terminal as needed.

IBM and Sun Microsystems Inc. have both introduced versions of network computers. Oracle Corp. has unveiled specifications for a similar machine.

The new IBM NC division will coordinate all of IBM's NC work, including hardware, software and network management.

The unit will be led by Bob Dies, formerly head of IBM's AS/400 division. He'll report to Robert Stephenson, senior vice president and group executive of the Personal Systems Group, which includes IBM PC Co., the company's PC operations.

That the new unit reports to the same executive who oversees IBM's PC business shows the similarities in the two markets. Some companies and industry executives predict that the NC will replace the personal computer.

Gerstner said there will continue to be a market for both types of machines, and that IBM will strive to be a leader in both.

Pub Date: 11/12/96

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