Helping Companies Deliver Windows-Based Applications

REDMOND, Wash., Jan. 18, 1999 — For Mirage Resorts, Inc., keeping the computers running around the clock is a top priority. With its Las Vegas hotels and casinos open 24 hours a day, there’s no “right time” to upgrade software on employee desktops. With these conditions in mind, Mirage decided the most efficient setup would be a computing environment powered by Windows NT Server 4.0 Terminal Server Edition server software.

Using Terminal Server has enabled Mirage Resorts to save money by managing hundreds of desktop devices centrally from a handful of servers, said Glenn Bonner, vice president and chief information officer for Mirage Resorts. It also has allowed the company to maintain and deploy software applications from behind the scenes without getting in the way of its guests.

“In a 24-by-7 environment, doing hardware repairs is like turning the vacuum cleaner on in the house on Saturday when your better half is watching TV-you don’t often want to do that,” Bonner said. “Because the properties are 24-by-7, the best way for us to upgrade the end user is back in the computer room.”

Mirage Resorts is among hundreds of companies that are reducing costs and streamlining computer maintenance by moving toward a Terminal Server environment where desktop computers store and process minimal information, shifting the burden to a centrally managed server.

Like Mirage, many customers are turning to Terminal Server because it allows them to run the latest Windows-based applications on a wide variety of desktop devices, including new Windows-based “thin clients.” Sales of Terminal Server already exceed Microsoft’s forecasts, and that growth is expected to continue. Microsoft announced this week that it will revise Terminal Server licensing and packaging to make it less expensive and complex for users to purchase the product.

“Microsoft is pleased about the demand for Terminal Server, and is excited about making it even easier for customers to purchase and deploy the product,” said Solveig Whittle, Microsoft’s lead product manager for Terminal Server.

By storing and processing all the data in a central location, information technology (IT) managers can maintain greater control over the computing environment by preventing employees from making unwanted adjustments to the software and hardware setup from their desktops. In addition, IT managers can reduce training and support costs by presenting a simpler computer environment for workers.

Terminal Server also allows companies to bring 32-bit Windows applications to a variety of non-Windows devices such as UNIX, Macintosh and DOS computers as well as older PCs based on 16-bit Windows operating systems. It also is an ideal for replacing older, text-based terminals that run specialized business applications. To take advantage of the software, companies with mainframe terminal environments must upgrade their terminals to a Windows-based terminal, typically priced at $500 or less from companies such as Wyse Technology Inc., Network Computing Devices, Inc. (NCD) and Boundless Technologies Inc. Macintosh computers and older Windows-based PCs don’t require this upgrade, as they use “terminal emulation” software that is compatible with Terminal Server.

Microsoft first announced its intent to add this new technology to Windows NT in May 1997, when it signed a technology cross-licensing agreement with Citrix Systems Inc. The agreement called for Microsoft to license Citrix technology and for both companies to work together to make Windows NT Server 4.0 and 5.0 work with “dumb” terminals and other non-Windows devices.

“Customers have told us that reducing total cost of ownership is a critical issue,” Microsoft’s Paul Maritz said at the time. “We are evolving the Windows platform with key hardware and software initiatives to aggressively address this fundamental issue for our customers.”

Microsoft released the first beta of Terminal Server in November 1997 and the final product in June 1998. The company sees the product as another option for IT managers for deploying Windows-based applications, particularly those who have aging mainframe systems and can’t afford to upgrade to 32-bit PCs.

“The primary market we’re targeting is the terminal replacement market,” Whittle said. “People who have mainframe computers with terminals-the older, character-based devices that have been around for 10 or 15 years-don’t have the ability to run the newest applications with a graphic user interface because their desktop systems may not yet be running a 32-bit Windows operating system.”

Terminal Server is also a good solution for IT managers who manage a mix of computers such as mainframe terminals, Macintosh computers and Windows-based PCs, she said. “With Terminal Server running applications centrally, they can roll out application across a variety of desktops, and they don’t have to have lots of different versions of their client software. For example, they don’t have to have both a Macintosh version and a Windows version of Microsoft Word and worry about whether people can exchange documents.”

Finally, Terminal Server makes sense for companies with computers in remote locations. “An oil company that has an oil rig in the North Sea won’t want to put an IT manager out there to manage all of those remote computers,” Whittle said. “They can run the application from their home location and serve it out using Terminal Server to that oil rig. And then if there’s a problem, they can service it more easily because the application is actually running back in the home office.”

While Terminal Server is a good solution for some computing needs, it is not ideal for every setting, Whittle said. For example, it’s not the ideal choice for employees who need to accomplish work without connecting to a server. “In a Terminal Server environment, you’re dead in the water, if you don’t have a connection back to the server,” she said. “Say you’re a salesman and you’re on the road all the time. You couldn’t do much work if you took a terminal with you because you wouldn’t be assured that you’d have a connection back to the server all the time.”

In addition, Terminal Server is not the right choice for users who use complex, CPU- or memory-intensive software programs such as multimedia and graphics applications because running these applications from a server results in slow performance. “Applications that are very graphics intensive take up a lot of processing power on the server,” Whittle said. “People using these applications might as well go out and buy a 32-bit PC, and run the application on the PC locally at the desktop because that’s going to be much more efficient in the long-run.”

On the other hand, Terminal Server is ideal for companies that consistently use one or two specialized business applications, such as software used to manage telephone call centers or monitor a company’s accounting procedures. It can also be used to run e-mail applications like Microsoft Outlook and business productivity applications such as Microsoft Office while IT managers upgrade legacy desktops such as Macintosh or UNIX devices to PCs.

Microsoft this week made it easier for companies to purchase Terminal Server by announcing a new pricing structure to reduce the cost of licensing the product for each desktop device it serves. Until now, companies were required to pay a Windows NT Workstation 4.0 license (Estimated Retail Price $269) and a Windows NT Server Client Access License (ERP $39.95) for each desktop computer Terminal Server serves. Microsoft will replace the Workstation license with a new Terminal Server Client Access License (ERP $109).

The change, which will take effect Feb. 1 in English-speaking countries, was made in response to customer feedback, Whittle said. “Basically it will cost about half what it would have cost you before for each client license,” she said.

So what are Microsoft’s future plans for Terminal Server? Unlike Windows NT Server 4.0 Terminal Server Edition, the next version will not be sold as a separate edition of Windows. Rather, “Terminal Services” will be a feature incorporated into the Windows 2000 operating system starting with Beta 3 of the product. “So when you install the server, you’ll be able to check a box that says Terminal Services to enable that capability on that particular server,” Whittle said.

In the meantime, the market for Terminal Server continues to expand. Many terminal and server manufacturers such as NCD, Boundless, Wyse, Compaq Computer Corp., Digital Equipment Corp., Hewlett-Packard Co. and Data General Corp., Philips Electronics and Netier Technologies Inc. are offering products based on Terminal Server. And software vendors are developing products that run on top of the product since virtually any application that runs on Windows NT 4.0 will also run on Terminal Server.

“Since Microsoft entered the thin-client market with Terminal Server, our business has increased tremendously,” said Glen Holmes, president of Micro Visions, a computer consulting firm that specializes in thin client computing environments. “We’ve increased our staff from 20 to 40 systems engineers in the last six months and have sold more thin client solutions in the last six months than in all of ’97. We expect ’99 to be a tremendous year and view rapid deployment client-server applications and fixing Y2K issues as incredible opportunities for Terminal Server.”

At Mirage Resorts, officials plan to use Terminal Server to provide Microsoft Office and Outlook e-mail to 2,000 Windows-based terminal users by the end of this year. Employees served by Terminal Server include those working at the resort’s new Bellagio Resort, which opened in Las Vegas in October, and Beau Rivage, a new resort scheduled to open in Mississippi this March.

The advantage of Terminal Server, according to Bonner, is that it enables Mirage Resorts to supply the latest Windows applications to employees using a variety of computing devices, while reducing the cost of maintaining the company’s computer systems.

“We believe there’s a tremendous cost savings in terms of the long-term maintenance and management of the systems,” Bonner said. “If you have 50 users on a Dell PowerEdge Server, you can upgrade those 50 users in the same amount of time it would take to upgrade one user on a PC.”

While many Mirage employees use Terminal Server for administrative work conducted behind the scenes, Terminal Server is also used by employees in the “gaming pit,” who use it to track players’ ratings and issue them gambling credit. The advantage of Terminal Server for these employees, according to Bonner, is that hardware problems can be fixed quickly.

“If my computer engineer gets a call and they say, ‘We have a problem out in Pit 19, come look at the PC,’ they go out there and more than likely the first thing they’re going to do is reboot the computer,” Bonner said. “So there goes five minutes. If you have a problem with a thin client, you just carry a new one out there, unplug it, plug in a new one and push the button. In five minutes you’re back up working. The benefits are tremendous.”

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