Network Computing Devices Inc is redefining itself again, by selling its Z-Mail electronic mail division to NetManage Inc, on undisclosed terms, and refocusing on its definition of the Network Computer. The agreement gives NetManage all licensing responsibilities, sales, development, and support for Z-Mail, which it says is currently being used by more than 500,000 users. NCD last recast itself in January, when it sold its Mariner business to FTP Software Inc. At that stage it justified the sale as allowing it to concentrate on its core businesses – of which one was then said to be Z-Mail, with the other quoted as its PC-Xware server software. For its part, NetManage – which has only just launched its JetMail Email system as a low-cost alternative to other Simple Mail Transfer Protocol (SMTP) based systems – is planning to overhaul it, by integrating it with Z- Mail. Specifically, NetManage was attracted to Z-Mail’s cross- platform capabilities (it supports Windows, Unix, the Apple Macintosh and character terminals, where JetMail only supports Windows, Windows 95 and Windows NT) as well as the strong name recognition of Z-Mail. Indeed, according to Walt Amaral, NetManage’s CFO, many people don’t realize we’re in Email, even though we’ve been in it for years. In fact, NetManage has another Email package, alongside JetMail, which is part of its Chameleon IntraNet desktop suite. The plan, according to Amaral, is to migrate that and JetMail to a common code base with Z-Mail, although it has yet to be decided which of the products will form the basis of this. NetManage will take on NCD’s Z-Mail sales and support staff, although the future of the R&D department seems far less certain. NCD’s decision to use its X-terminal expertise to position itself as a Network Computer (NC) company mirrors closely the move of fellow X-terminal maker HDS Network Systems Inc last week. According to Joe Ramirez, NCD’s general counsel, the change has been part of an evolving focus. He says that the company decided to sell Z-Mail for two reasons: firstly because development has been an incredible price pressure, and secondly because price erosion in the market means that the company has seen increasingly diminishing returns on its R&D development. The irony of the situation is that NCD has basically gone full circle: it diversified into Email by acquiring Z-Code Software Corp in 1994 when it feared the death of the X-terminal market. As to whether NCD can get its price down to the sub-$500 machine being touted by Oracle, Ramirez says that the company is already selling its X-terminal-derived Explora machine for $1,000, and the company is confident that it can get the price down much further once volume sales and production are in place. An NCD spokesperson said the company will not be attempting to tackle the consumer marketplace – with its characteristic low-speed modem connectivity – but will concentrate on the corporate market. NCD is also in the process of licensing Java from Sun.
