NComputing Fizzles

Besides having great products a business needs to make sound choices to succeed.“In the third quarter last year, NComputing’s market share slipped to 9 percent from 15.9 percent the same period the year before, and the number of units it sold to customers fell 45 percent, according to research firm IDC. In the first quarter last year, the company saw a 20 percent decline compared with 2013.
"I think that NComputing has reached the end of its capabilities," said Clive Longbottom, an analyst with research firm Quocirca. "Without crossing the chasm to get to the next stage, it will remain a small company — and one that just withers and dies."
Despite the slip last year, revenue remained strong — $140 million, a 56 percent increase over 2013, according to financial research firm PrivCo. However, analysts say the company was probably burning through cash at an even quicker pace to develop new products, which ultimately didn’t sell as well as company leaders promised.”
NComputing succeeded for years, but these days, as thin client technology is taking over the world and competition is heavy they have run out of steam. While unit sales plunged, their revenue increased but not as fast as their costs. They could not adapt and are seeking a buyer.

It’s not, what some visitors here have claimed, that thin clients are junk, destined for the scrap heap. IDC reports that business is maturing with room to grow. In my own experience, thin clients offer several important advantages to users: small size, noise, energy consumption, and greatly reduce the capital cost of client farms while optimizing the production of the powerful terminal servers. On top of that they reduce the number of systems for which an administrator has to worry about the file-system. The only negative is full-screen video tends to be sluggish. NComputing had technology to deal with that but so did others.

See Santa Clara's NComputing is for sale and in deep financial trouble.

About Robert Pogson

I am a retired teacher in Canada. I taught in the subject areas where I have worked for almost forty years: maths, physics, chemistry and computers. I love hunting, fishing, picking berries and mushrooms, too.
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10 Responses to NComputing Fizzles

  1. clive wrote, “what is the durability of ncomputing thin clients?”

    I don’t know their products specifically, but I’ve installed thin clients that still work after 10 years. With no moving parts, they just keep on ticking. The limiting factor seems to be that graphics loads increase over time: higher frame rates and higher resolutions are desirable. Over a decade, graphics loads can double or more. Fortunately, Moore’s Law is able to keep up and a new thin client with gigabit/s network, better graphics and more powerful CPU can still be had fanlessly. These days, ARM is an option but even x86/amd64 has cut power usage by a large factor. I was just reading about AMD R-series SoCs that can do the job for about 15-35W and compare with Intel i7 CPUs. I’m sure ARMed systems would be half of that or less, e.g. smartphones are competitive.

  2. clive says:

    what is the durability of ncomputing thin clients?

  3. oiaohm says:

    DrLoser Linux thin client devices contain all the major protocols to connect to all the major vendor solutions.

    There are quite a few thin-client device only vendors as well. http://www.thinlinx.com/ comes to mind. ThinLinx has 8 times the turn over of NComputing

    The …. was the fact it was not just HP alone. thinlinx does not sell PC at all.

    If your product range is 100% footling, with the profit margins and cash-flow limitations I described earlier, then you are basically the next N-Computing.
    So this is another one of your bull crap claims DrLoser.

    thinlinx and other small vendor thin clients prove you can produce decent vendor neutral product you will have no problems making enough profit.

    Do what Nmachine did and make vendor lock products you will die. If you do make a locked product you must also make a vendor netural product with the vendor neutral being dominate.

    This is the result if you survey the profitable thin-client companies.

  4. DrLoser says:

    DrLoser remember dell hp and others make a lot of money off of thin-clients providing neutral solutions.

    I’d hardly call a Linux thin client a “neutral solution,” Fifi. (Nor, as a matter of fact, would I hold it against them.)

    Dell, HP, and unspecified other large hardware corps make a footling amount of money out of thin clients. So what is your point? Mine is that, if you are a large enough supplier, you can afford footling, because it is a part of your product range.

    If your product range is 100% footling, with the profit margins and cash-flow limitations I described earlier, then you are basically the next N-Computing.

    Dead, dead, dead in the water.

  5. ram says:

    It is a little hard to sell plug-in network cards when almost every motherboard and computer comes with them built in. Tha, and Ncomputing hardware being incompatible with many systems pretty much guarantees they would go out of business. I bet the share promoters made alot of money though!

  6. oiaohm says:

    DrLoser remember dell hp and others make a lot of money off of thin-clients providing neutral solutions.

    Cost of hardware is linked to volume you can produce and sell. So hardware that can go out and cover the complete market works out in most cases is cheaper production due to being able to make more unit volume.

    ncomputing has many competitors who are making very decent profits. None depending on major vendor lockin that much.

    http://www.teradici.com/pcoip-technology
    Yes pcoip based techs is another competitor. Teradici goes the license out to vendors route. So avoiding having to use after market software hacks as much.

    Teradici also allows hardware vendors to compete for market space so keeping price down. Teradici is doing quite well.

    Ncomputing from my point of view took a completely wrong business model.

    userful, Teradici, Vmware… The list goes on of companies making quite a decent profit out the zero-client game. The one thing that is universal is none of the successful tried to control the hardware side of the clients instead allow independent vendors fight it out of course in some cases paying for patents.

    IDC reports that the thin/zero client market is growing faster than the PC market.

    Basically a lockin solution DrLoser turns out how to fail in the thin-client market. Remember what I said about thin-client devices having operational lives of 10 years or more. The life span of thin-client devices is why making highly exclusive hardware is a major problem. As a buyer you want hardware supporting a generic protocol in case the software company you are currently using goes under.

    Think about it this way DrLoser I release a computer with Z expandion bus instead of standard pci express as a vendor I might be able to provide everything but you will think twice about using my product right. Even if I had a perfect reputation.

    Never underestimate the importance of official standard conforming.

  7. DrLoser says:

    I don’t suppose anybody has considered this:

    The combination of the small average selling price and the long sales cycle made NComputing become an enormous cash Hoover vacuum…

    Low margins and lousy cash-flow do not a successful business make.

    Now, it’s possible that there’s a huge untapped viable market for thin clients out there. But it isn’t going to happen just because “the technology is cool” or because “Mr Pogson Says So.”

    Somebody actually has to make a significant profit out of this stuff. I’m not convinced that there’s a USP for any particular company, unless it’s a lock-in system (which appears to have been the case with N-Computing). And as oiaohm sagely points out, there are a number of possible issues with that approach.

  8. oiaohm says:

    dougman one of ncomputing major competitors is http://userful.com/

    Difference here is userful is open to more hardware vendors. The hardware that userful uses is in fact usable with other vendor solutions.

    So ncomputing death is all about attempting to lock market in way too tight to attempt to restrict competition.

  9. dougman says:

    Shame, I set a few instances of Linux computers using the M-series hardware.

    http://www.ncomputing.com/products/mseries/overview

    I was able to connect four simultaneous users to one computer at a time. So in essence, sixteen users would be utilizing four computers. or any variety there of.

  10. oiaohm says:

    Really I can understand why lot Ncomputing stuff was nasty bits of work that only worked with Ncomputering server software. Yes nice bit of unique stuff to cause software issues nothing else suffered from..

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