You'd better disable USB mass storaeg devices & optical/floppy drives as
well if you want to keep out viruses.  You need to set up your GPO very
carefully.  Oops.  If you want GPOs you need Active Directory and a
staff to administer it.

FAIK no one makes hardware keyloggers for terminals but they certainly
exist for PCs.

Can you keep the PC-illiterates (of which there are still plenty!) from
deleting application or system files?

Hard drives MAY (not WILL) spin for years without replacement, sure.
They also may fail 14 seconds after the warranty expires.  You have no
guarantees but you do have the knowledge that they're built to achieve a
certain price point.  That should tell you something.

PCs have moving parts.  Moving parts fail.  Could be the hard drive.
Could be a fan.  Doesn't matter.  Failures = downtime = lost

PCs draw more power and generate more heat; you'll spend more on your
utilities.  Go find out your data center's power bill if you don't think
it can be significant.

The $400 unit will come without an OS or, at best, with XP Home.
Upgrading to XP Pro as you mentioned will cost a minimum of an
additional $140 if you buy OEM licenses.  So it's more like $540.  I'll
assume you're using a free emulator.

That now $540 Dell has a 30-90 warranty; only the more expensive PCs get
a year or better.  What's the cost to fix if something breaks
afterwards?  I'm assuming another $540 because technician time + buying
parts will quickly outstrip the purchase price.  Not to mention the cost
of the downtime/lost productivity.

The terminal is plug-n-go as quick as you can configure an address.  The
PC has to have the OS & apps installed or loaded from an image.  But you
won't be using images for long if you buy the el-cheapo machines.  They
are frequently built from parts-of-the-week or are end of model run
units.  No guarantee that they'll accept the same driver set.  So count
more IT staff time for installation of a PC.  Also, since you need LAN
autehntication for the GPOs you now have the ID maintenance issues
associated with the PC (you know the old saying about __% of all help
desk calls are password-related).

The 'extra equipment' needed to connect to the iSeries replacaes the
'extra equipment' (switches, routers, firewalls, etc.) needed to connect
to the LAN.  As twinax is in decline, the price-point here should favor
Ethernet in most circumstances.  On the other hand, since you can
daisychain twinax, in some circumstances it will net out cheaper.

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