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Published: Sunday, 11/12/2000

Newest PCs no longer top priority at local businesses

BY JON CHAVEZ
BLADE BUSINESS WRITER

Toledo's largest company abandoned its used-computer store about two years ago, after several years of successfully stocking it with outdated computers it leased to other firms worldwide.

Dana Corp.'s sale of the store proved timely. Many corporations that once wanted new equipment every year or two are replacing PCs every three or four years.

The change, which saves money that would have been spent on equipment purchases, has occurred because computers have become more sophisticated.

``You reach a certain level where you say, `How fast do you have to do your e-mail?''' said Dana spokesman Gary Corrigan.

``What you're seeing companies looking at is the software side. Normal people are gaining computer access and with more people getting access, we are upgrading computers that are two and three years old.”

Software programs that many companies use don't run any better or more rapidly on an ultra-fast Pentium III 1-gigahertz or AMD Thunderbird 1.2-gigahertz processor.

Pilkington North America, the Toledo-based subsidiary of British glassmaker Pilkington Plc., has lengthened its corporate PC leases to four years from three. It will save about $1 million.

Owens Corning's tech center monitors a network of PCs. The company is bucking a trend toward keeping hardware longer. Owens Corning's tech center monitors a network of PCs. The company is bucking a trend toward keeping hardware longer.
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With the growth of wireless phones and devices like personal digital assistants that can tie into the Internet, some functions that formerly could be done only on a personal computer are possible on these other machines. So requirements for PCs are simpler and companies do not necessarily need the fastest and best model on the market, said Bill McCreary, Pilkington North America's vice president of system technology and its chief information officer.

``We're taking many things off the [PC],” he said. “You don't have to have as much on them.''

The company has about 2,000 personal computers, half desktop models and half laptops.

Replacement, Mr. McCreary said, becomes necessary because of wear and tear, not because better technology is needed.

The latter is the reason the company's laptops probably will be replaced every three years. However, if functions now done on laptops can be done better or more conveniently on other devices, the carrying-case-sized computers are likely to be used less and to last longer, he added.

Dana Corp. uses nearly 20,000 desktop and laptop computers worldwide. It replaces them every two to two and a half years because

what the firm might save by keeping its PCs longer it would spend in maintenance fees, said Kevin Moyer, vice president for e-business.

Because Dana relies heavily on keeping all its subsidiaries in contact, the company also invests heavily in maintaining and upgrading computers that control its network.

``We do see the future as being server upgrades rather than desktop upgrades,'' Mr. Moyer said.

Mr. Moyer is among those who do not believe that having the fastest computer is a necessity. So the company's policy is not to upgrade simply because something new is available. But he said that when it comes time to upgrade, the company looks at the newest technologies.

Charles Smulders, a personal-computer-industry analyst with the Stamford, Conn.-based Gartner Group, said longer use of PCs is beginning at many corporations. Clearly, many employees and executives don't need to upgrade to the latest PC as frequently as in the past, he said.

Brad Asher works in a lab at Pilkington North America, which has lengthened its PC leases. Brad Asher works in a lab at Pilkington North America, which has lengthened its PC leases.
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``The issue here is: What you're seeing is the level of performance far exceeds the needs of the user,” he said. “They're looking to forgo some of those technology costs.”

John Zarb, vice president and chief information officer for Libbey, Inc., said he, too, plans less frequent replacements of personal computers for nontechnical employees. Theirs are now replaced every three years, but the Toledo glassware maker upgrades researchers' PCs almost annually.

The central processing unit, or brains, of the computer, “is pretty much a plug-and-unplug thing today, so I don't get too concerned about upgrading like I used to,” Mr. Zarb said. “But if I can make something last 32 or 42 months, I will.”

Some corporations, however, aren't likely to switch to less frequent replacements. In that category are companies like Toledo's Owens Corning, for which video conferencing and video digital signals are vital links with staff, customers, and suppliers worldwide.

Such technology demands faster, higher-performing personal computers, which means the need for the latest PC model is greater, making for a shorter lifespan for its office computers.

OC, the $5 billion-a-year global building products maker, replaces its 10,000 PCs and laptops on a three-year cycle.

David Johns, OC senior vice president and chief technical officer, said he isn't surprised other companies are replacing their computers less often. ``PC makers out there are getting much better and equipment is getting more reliable,” he said. “Its shelf life is longer and the next [breakthrough software program] hasn't come along yet.''

Many companies are weighing whether to use video technologies, said Mr. McCreary of Pilkington. His company has opted to forgo it. Instead, the auto and building glass maker looked at Internet-based audio conferencing and found it suited the company's needs without requiring ultra-fast and powerful personal computers, he explained.

Corporate information technology experts generally either suggest standardizing corporate PCs for all users or recommend buying a basic machine and letting the user purchase whatever off-the-shelf software is desired, resulting perhaps in one user having Microsoft's Excel spreadsheets and another having Lotus 1-2-3, he said.

The business trend toward less-frequent PC replacement is affecting computer makers, who still have healthy sales from home users but for whom growth in corporate purchases is slowing. That could lead the industry to try to come up with new products, said Mr. Smulders, the analyst.

Compaq Computer, for example, recently introduced its Ipaq computer and Hewlett-Packard followed with its e-Vectra, Both are smaller, slimmer, no-frills models that fit neatly on a desktop and provide executives with all the computing power they would need for e-mail, Internet, spreadsheets, and other basic corporate functions.

The machines don't have the power for more graphic-intense functions, but may serve the needs of many executives, Mr. Smulders said.

“They are able to drive down the cost of ownership, deployment, and maintenance,'' he said. ``By buying further down the curb, a company can meet its needs and save money. And the industry is hoping it will stimulate new sales.''



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