Reseller Advocate Magazine features Professor Bernard Frischer

SFF Rises Again: Small Form Factor Just May Save the Desktop
By William Van Winkle
Cover Story (See original article)

Last time we checked, you couldn't buy time machines through distribution. And yet ...

Ram and FrischerTwo decades ago, Professor Bernard Frischer published a paper commenting how amazing it would be for historians and students if someday the power of computing could enable an artificial 3D environment in which the participant could wander about and experience a frozen moment from history. But in an epoch when 286s roamed the Earth, you can imagine how impossibly fanciful that vision must have seemed beyond the bounds of Hollywood. Many years later, tools emerged that would allow end-users to create such virtual environments. In particular, OpenSceneGraph, an open source 3D graphics toolkit based on C++ and OpenGL, looked promising as a medium in which to recreate history in 3D. The problem was then one of hardware. By January of 2002, to model something on the scale of an entire 3D city required nothing less than a Silicon Graphics Onyx workstation.

Only three years later, though, Professor Frischer was wandering two sets of hallways. The first set was at the University of Virginia, where he is the director of The Institute for Advanced Technology in the Humanities and can often be seen dashing from appointment to appointment with a Shuttle XPC in his backpack.

The second set of hallways was in buildings like the famed Roman Colosseum, where Frischer could wander the corridors, getting close enough to surfaces to see the texture of the mortar between stones. Of course, this version of Rome, a virtual reality landscape mimicking the moment of 10:00 AM, June 21st, 320 A.D., was being generated by his little XPC, much in the same way that millions of people wander around in the popular Second Life world. (This Roman universe, designed largely on Shuttle boxes, is one of two dozen similar recreations spawning from Frischer's Virginia Digital Collaboratoreum (www.iath.virginia.edu/vdc) and is scheduled to go live to the public in late May.) The small form factor XPC, Frischer notes, creates this world with better performance than the Onyx workstation could only a few years ago.

"We make heavy use of the Shuttles as our desktop machines," he says. "It's great, because, like any PC tower, you can open it up and update the components, but the footprint is a lot smaller. And it's a very cool-looking box that draws a lot of attention, so there's that element, too. But it really adds mobility. It's very easy to pick up and put in a backpack and go use it in a class or at a scientific meeting to show work to colleagues. Since it uses desktop and not laptop components, and since desktop components always seem to be at least a year ahead in terms of computing power, this form factor is very advantageous for us."

We point out Frischer and his Rome project because they exemplify the opportunity the channel now faces in the small form factor (SFF) spacean area many resellers currently ignore. Of course, we all remember three or four years ago, after Shuttle's XPC line became immensely popular, when hordes of XPC clones flooded the market. Everybody had a cube to sell, but very few of them actually sold. Why? Oversaturation of a niche market probably had a lot to do with it. XPCs gained their fame in the gamer community, where desktop-class machines could suddenly go toe-to-toe against towers at LAN parties without requiring a back brace for PC transportation. It seemed that SFF was about to go mainstream, everybody rushed boxes to market, and the mainstream adoption never happened, probably because of the price premium carried by the smaller, more integrated, sometimes proprietary designs. Companies like ASUS, Biostar, ECS, FIC, iWill, MSI, Soltek, SOYO, and others saw their efforts crash and burn as the demand for SFF PCs evaporated. Most of these were good PCs. It's just that nobody wanted them.

Then came Intel's Viiv platform in early 2006 and with it a surety that the real destiny of SFF lay in the living room as part of the networked home theater. This was in the months before Core 2 Duo and the transition to Core microarchitecture. The best candidate Intel had at the time for small form factor was the Pentium M, which had just morphed into the Core Duo, and its Centrino-like mobile-on-desktop (MoDT) platform. Mobile-on-desktop was a stellar idea: great performance, low power, tiny size, and about the price premium you'd expect from a notebook architecture. The problem was that MoDT was linked to Viiv, and when the Viiv effort fizzled for various reasons, MoDT largely went with it. Only this time, the situation was worse. At least in 2003, vendors had taken a leap of faith with their SFF cubes and gone to market. In 2006, the majority of MoDT boxes never made it past the blueprint or prototype stage.

Critical Condition or Critical Mass?

RamSo here we sit in 2007 with a lot of evidence suggesting that the small form factor market is dead. Only it's not quite.

"In Q2 and Q3 of 2005, small form factor was just over 1% of the market," says Toni Dubois, senior analyst, computing, with Current Analysis. "The hard thing is that when a customer looks at a SFF and a mini tower side-by-side, the mini tower not only usually has a better feature set but it also costs less. But in Q4, HP's slimline [Pavillion S] series came online, and of course there were already the Mac minis, which pioneered the space. Then the market jumped in size to nearly 4% share. This AMD/HP cooperation yielded a very reasonably priced small form factor unit that caused ASPs to drop below $500 for the first time, which is why share is now up to about 6% of the market. But the overall condition is that small form factors still remain too costly for most consumers.

The important thing to note about Current Analysis' numbers is that they only track through big retailers, most of which don't carry names like Shuttle or AOpen. No channel sales, no e-tail, and no corporate sales figures. What we can learn here is that SFF either doesn't sell at all or it doesn't sell through retail...unless there's an Apple or HP logo on it. More encouraging news comes from IDC analyst Richard Shim, who forecasts that small form factor market share will be 23% by 2010, roughly 39 million units out of 168.9 million desktops. In 2007, the industry sits at just above 18%, representing 26.6 million units worldwide. An increase of 5% total share by the end of the decade may not sound like much, but compared against a decline of five million annual units in the tower category, small form factor isn't doing badly. The real opportunity, though, is in the ultrasmall form factor, which is projected to grow from 3.9 million units this year to 11.8 million in 2010.

"Small form factor is affordable, familiar," says IDC's Shim. "It's one of the few bullets the channel can use to stave off the erosion of desktop market share. It's a concept that doesn't require a lot of support from other factors. For example, the digital entertainment home PC requires support not just from the PC industry but also the content industry, networking, and to some extent broadband. With small form factor, you can be flexible with the design in order to attract a larger market."

IDC's 2006 report is less bullish on small form factor than previous estimates, and some of that has to do with the changing fate of BTX. Other influences include the ongoing problems of easily bringing premium content to living room PCs combined with set-tops and digital media adapters consuming the primary role of living room PCsin other words, the same factors that helped pin Viiv to the mat. However, the trend that made mini-towers become the dominant form factor over mid and full towers, trading performance and expansion for space and lower noise, will only continue to help elevate the sub-mini categories. Five years ago, there was no such thing as consumer network attached storage, and no one in the business space would seriously believe that thin clients would ever make a comeback. But here we are. An increasing number of clients don't need heavy-duty computing and storage resources, and public awareness of PC noise and energy consumption issues is only escalating.

That said, while a market embracement of SFF seems inevitable, there are things system builders can do to help push adoption along. As we asked industry contacts for their opinions, most agreed that small form factor systems should lend themselves to both portability (consider how the reduction of cable connections via a USB hub can assist this, almost in the manner of a notebook port replicator) and ease of desktop placement. In this regard, smaller is usually better, but the ability to orient the system either vertically or horizontally counts for bonus points. Vacuum fluorescent displays (VFDs), found in higher-end home theater PC (HTPC) cases, can help draw attention. The same is true of media center-related features, such as HDMI output or chassis styling that conforms to most consumer electronics components.

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