Will Networking Replace the PC?

First there was the mainframe, then the personal computer; now a third wave of computing may well shake up the industry: interactive networks

It seems downright contrary to say the desktop computer is passe. Sales of home computers are soaring. Last month's release of computer operating software called Windows 95 caused such a stir that it sold millions of copies within weeks. But technologists are yawning. After a decade at the forefront of dramatic technological change, the personal computer is being pushed aside, they say. The future belongs to global networking. ''Your computer will never be the same,'' wrote technological guru George Gilder in last month's Forbes ASAP magazine. ''No longer will the features of the desktop decide the features of the machine.... No longer will the programs in your machine determine the functions you can perform. The network is the computer. The computer becomes a peripheral....'' Mr. Gilder is the leading proponent of the network-is-king theory. But he is hardly alone. Paul Saffo, director of the Institute for the Future in Menlo Park, Calif., describes the change as the third wave of computing. In the first wave, he says, information-processing was the key. Companies such as IBM built huge mainframe computers capable of fast, complex calculations. In the 1980s, business people didn't want to wait anymore for mainframe experts to give them information. So they bought the newfangled desktop computers of the day and began to generate their own computer analyses. Information-access became the second wave of computing. ''The third wave, the next wave, is access to other people,'' Mr. Saffo says. Instead of the second-wave vision of a computer on every desktop, the new world of computing will link all those machines together. People will send each other information or make it available on-line for others to see. It sounds like the Internet. But the Internet that these technologists envision is much faster and more flexible than today's. Take the part of the Internet called the World Wide Web. Conceived in 1989 by researcher Tim Berners-Lee in Switzerland, the Web makes Internet navigation easy. Instead of typing in odd-looking commands to move from one Internet computer to the next, the Web lets users navigate using a mouse. In early 1993, two programmers from the National Center for Supercomputing Applications, at the University of Illinois at Champaign-Urbana, improved on the idea and caused Web usage to skyrocket. Their program, called Mosaic, allowed the Web to display pictures and graphics. Mosaic became a hugely successful viewer (called a ''Web browser'') through which to look at the Internet. Suddenly businesses, publishers, individuals - everybody - had to be on the World Wide Web. But even the Web, for all its ease-of-use and pretty pictures, hasn't ignited technologists' enthusiasm. ''This file-based Web is dog meat,'' says George Colony, president of Forrester Research in Cambridge, Mass. People don't just want access to static information on-line, he says. They want to process that information. And they want to interact with one another. Mr. Colony calls this technology the ''transactional Web.'' Gilder calls it the ''hollowed-out'' computer. To understand the idea, consider the stand-alone computer. It has a spinning magnetic disk - a hard drive - that pretty much determines the scope of its universe. It limits the data that can be stored. In most cases it runs only the programs for which its operating system is designed. This limited universe can be stretched via a cable link to a local network of other computers or a modem connection to the Web. But the network remains limited. And on the Web, users can't interact with data directly. But novel software, called Java from Sun Microsystems, in Mountain View, Calif., does allow direct interaction on-line. This means that software can reside on the network just like data, and software programs can be executed in real time. This is a big step. If a professor wanted to put a physics demonstration on-line today, she would have to write the software for a specific type of computer, load it onto the Web, have a user download it to his machine and run the program. If the software was written for a Macintosh and the user had an IBM computer, it wouldn't run. Using Sun's Java language, the professor only has to write the program once and put it on the Web. Any user, equipped with a HotJava Browser, could go to that spot on the Web, click the ''start'' button while on-line, and the program would run. It wouldn't matter what operating system the user had or the type of computer. The browser would translate the program automatically, but in a secure fashion to keep computers safe from rogue programs such as viruses. ''There's no question that the hollowing out occurs,'' says Eric Schmidt, chief technology officer for Sun. ''The only argument we're going to have is which companies win and which lose.'' Indeed, the third wave of computing will have enormous implications for the computer industry. Among them: r The king of personal computer software, Microsoft, may be in trouble. Some investors believe that a small, year-old company called Netscape Communications could give Microsoft a run for its money in the new world of computing. Netscape has 70 percent of the Web browser market, access to Sun's Java language, and is working on keeping communications secure. (However, reports this week of two California college students breaking its encryption code within seconds have increased concerns about Internet security.) Meanwhile, Microsoft's traditional advantage - the dominant operating system on desktop computers - would become less important in the global-network era. On the first day Netscape's shares were offered to the public, the company briefly saw its stock price shoot up from $28 to $74 a share. r Other software companies could face a rough ride. What happens to their elaborate distribution systems and customer base if Java-like programs, stored on a few Web computers, can do all the work? r What about the makers of computer hardware? ''You have to go beyond the PC model if you're going to bring the rest of the world'' to the Web, says Tim Bajarin, president of Creative Strategies, a San Jose, Calif., consulting firm. ''Why can't I run that same thing on my television?'' In fact, Apple Computer and Microsoft are working on software which could be run by an enhanced TV - costing hundreds of dollars less than a PC. The third wave of computing is more speculation than reality so far. ''Java makes sense in a PC arena,'' Mr. Bajarin says. ''Netscape makes sense in terms of being this interface. But it's way too early to tell.'' With Java, Sun has a jump on its competitors. And Netscape is incorporating Java in the next version of its Web browser. ''I think it's a real good start on the Transactional Web,'' says Colony of Forrester Research. But Microsoft won't give up without a fight. ''Netscape is just a fad. And I don't think that company is going to matter much in two or three years,'' says Jesse Berst, who publishes Windows Watcher, a newsletter in Redmond, Wash. ''Microsoft will do same thing, and reach millions more with its software for Internet.'' Microsoft has announced that it is developing a competing language to Java called Blackbird. Sun, meanwhile, is working on speeding up its own program with a device called a dynamic compiler, which will be available next year. ''It's going to be Java against Blackbird - in some form,'' Mr. Schmidt says. ''Microsoft is going to be a very difficult competitor.'' Global networking may sound like the Internet, but it's much more. Programs stored on a few network computers could do all the work for you.