The purchase of a rival by Network Computing Devices means NCD customers will eventually have thin-client desktops that sport a well-regarded technology for displaying video.
In the short term, by buying the Network Displays division of Tektronix, NCD becomes one of the biggest players in a still emerging market - Windows-based terminals and net-work computers that rely on servers for data and applications.
So far, the main players in the thin-client market have been relatively small vendors, most of which have been in business for years. One exception is IBM, which resells an NCD product tailored to IBM specifications.
The NCD-Tektronix deal, which is expected to close next month, will add about 130 employees to NCD, nearly doubling its head count, and will add experienced thin-client salespeople in US and overseas locations that NCD currently doesn't serve.
Tektronix's thin-client desktops are able to display streaming video managed by the company's server software.
One of the key business benefits of the deal for NCD is more heft and presence in a rapidly developing market rife with small vendors. "We saw growing demand [for thin clients] but we were limited by a $US4 million marketing budget and 80 salespeople," says NCD president and CEO Robert Gilbertson.
"With the Tektronix division we thought, 'together, we'd be able to create a pull effect in the market'."
The two companies are working out the final details of the deal, so no value has yet been put on the transaction.