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In 1992 when I started my study in Astronomy, most students at the physics department were using X-terminals. Workstations were still fairly expensive then and had more power than any one person needed (on average). The X-terminal was a fairly dumb device. It had an X server for graphical representation and tftp client for booting. They worked very well in combination with UNIX servers.
Around 1996, the Linux era began. PC's were even cheaper than terminals, with computing power that was beginning to rival the workstation. Lots of terminals were replaced with Linux PC's. This brought the administrators more work, but as the demand for computing power kept growing, this was good solution as the total cost of the infrastructure as a whole was hardly growing. An additional advantage was, that the PC's could be installed with Windows (which was/is not a multi-user OS) and Linux, giving the user a choice of what to use.
So you might say that Windows and Linux collaborated to push the terminal out.
Now that almost every employee has swapped his terminal (graphical or not) for a PC, we see that the PC at every desktop model has some disadvantages. In today’s environment it becomes harder and harder to keep the desktop environment under control. Viruses are rampant, software lifecycles become shorter and the pressure to keep IT cost under control higher.
A solution for this is to revert to the terminal of old. The main advantage of the terminal is that there are no moving parts. Terminals hardly ever break and if one does, make sure there is a spare in the broom closet. Every person who can unplug a cable can install a new terminal.
Working from a central environment has several advantages, among which:
The reason behind the terminal's revival? Desktop Virtualization! Most office workers are still working with the Windows OS, which still isn't a true multi-user operating system. On top of that, many users are loath to give up the privacy of their own desktop. This last argument is more psychological than real, since the administrator already has free access to their desktop.
New products in this area allow you to "remote" the display of the virtual system to a dumb device. This method also works around the typical difficulties with Terminal Server. This is important, because not all applications, even from Microsoft, are working well when started from a terminal. With the desktop virtualization products programs don't even have to know that they are running from a terminal, so those problems are solved.
However, desktop virtualization is not a must for using remote desktops/thin clients. Before any such project is started, an inventory should be created on which users could just work directly of a Windows server and which users would need their own virtual desktop. Chances are that most users will be able to share a server, reducing the maintenance effort for lots of desktop images and the license cost for the virtualization product.
Migrating to Linux or any other UNIX for that matter will fully eliminate the need for any virtual desktops, since multi-user is one of the core strengths of UNIX. If you do need Windows only applications, Codeweavers Crossover Office might be a good suggestion. I myself have been using it to run Outlook and Visio on Linux for years now. (Note that it works on Apple too!)
Using remote/virtual desktops has a few downsides though. At the core of these downsides is the network. During operation, the terminal will send keystrokes and mouse movements to the server and the server sends back the changes in graphical representations on the screen. For office work, this amounts to something between 50kb/s to 100kb/s. For an active user this goes up to around 1Mb/s. From this perspective, a remote office with about 10 employees could still be connected through an ADSL/SDSL connection.
Trouble begins with the new and flashy desktop effects present in Vista and also many new Unices. Enabling these will have a major impact on the network. Since these effects are not strictly necessary, they could be disabled. Playing a movie on a terminal will have the same effect though, so the web broadcast of the New Year’s speech of the CEO will cripple the network. Solutions in this area are coming though, in the form of MPEG decryption at the terminal level instead of the server.
Another problem is more day to day and has a larger impact; printing. Many printers in the corporate environment use PostScript as the printing language. A document containing a few images (the company logo in the template!) translates to a printjob several, of not tens of, megabytes in size. Now we return to the remote office with the 10 employees. A printjob in this environment might take minutes, up to hours.
About the same problem rises when an employee connects his/hers USB stick to the terminal to take a document home.
A whole constellation of options exist to resolve these problems. A few examples:
In my opinion the terminal is back and here to stay. This new generation of the terminal is maturing rapidly, though some details still need to be ironed out. The remote desktop should not be confused with the virtual desktop though. The virtual desktop is solution for users who do require the privacy of their own desktop and applications that won't work well in the multi-user environment. From that perspective, it is a very useful add-on for the remote desktop, but for most users, it won't be needed.