Wyse, the main player in Windows terminals, is launching a terminal that will run the embedded version of Windows XP. Despite the fact that it includes 128MB of RAM and 96MB of Flash memory, it still counts as a thin client compared with Windows XP desktops, says Wyse, and will be promoted as a smaller, more secure and more tightly controlled alternative to conventional Windows XP desktops. "Put your server in the data centre, not on the desktop," said Stephen Yeo, Wyse's marketing director for Europe, Middle East and Africa. "We are getting to the stage where people have to put something on their desk that would have been a server three years ago." Three and a half million thin clients will be sold in EMEA in 2005, according to predictions made by analyst IDC in June. The new Winterm will be sold not so much the price, but on reducing the total cost of ownership and putting the IT manager in control. This is very much the model proposed by thin client vendors in the late 1990s, when Larry Ellison predicted that Java-based clients could replace Windows. Yeo is candid that the thin client's modest success so far falls far short of Ellison's expectations: "We've been doubling sales every 18 months. However, when you start from zero it takes a long while. We are approaching one percent of desktops now." But the thin client lobby has moved away from the Java clients proposed six years ago, towards the ICA protocol and a closer relationship with Microsoft: "We are Microsoft's partner of the year," said Yeo. He proposes that IT managers have three choices -- stay with existing "fat" desktops, most of which are essentially unmanaged; upgrade to Windows XP, which improves desktop management ("managed fat clients"); or move to thin clients. The first option works out most expensive, he says, while upgrading to managed desktops cuts costs somewhat. Thin clients with embedded XP will typically pay for themselves in three to eight months according to Gartner Group research quoted by Yeo. Even this figure might not convince IT managers though, admitted Tony Locke, desktop analyst at Bloor Research. "A ROI less than one year ought to be a no brainer. But unfortunately there is a lot of emotion tied up with this." Wyse's Winterm 8235LE costs £586 + VAT for the model that will support embedded XP -- which Microsoft is due to launch on 28 November. A version with 64MB of Flash and 96MB of RAM costs £480 plus VAT. The lowest cost entry level at Wyse is £249 for the 1200LE ICA terminal. More enterprise IT news in Tech Update, ZDNet UK's enterprise channel Have your say instantly, and see what others have said. Click on the TalkBack button and go to the ZDNet news forum. Let the editors know what you think in the Mailroom. And read other letters.