Many companies have a large investment in these systems in terms of applications development, business processes, and data archives, in addition to the initial capital outlays. Furthermore, until recently, microcomputer technology could not match the performance, security, or manageability of these large systems. Therefore the PC and PC-based networks have typically come into computing environments where host systems are already functioning, often running the most critical business applications of the enterprise.

PC integration into these host environments has followed distinct stages. When the first PCs were brought into the corporate computing environment, they were standalone systems that shared desk space with the traditional host system terminal. It was soon apparent that the terminal could be eliminated if there were some way to use the PC as a terminal. This is the basis of terminal emulation. By using the proper terminal interface card, and software that provided the proper communications protocols, the PC could be plugged in place of the terminal, and would function in an identical way.

With the growth of PC LANs, and the emergence of LAN protocols that could be shared by both PCs and host systems, this emulation evolved from a direct terminal connection, to a network-based connection.

There are three types of terminal emulation that we are typically concerned with. As with many things in the computer industry these boil down to two categories, IBM terminal connections, and those used by everyone else. IBM has two proprietary terminal schemes, referred to as 3270-class terminals (traditional mainframes) and 5250-class terminals (System 3x and AS/400). Most other host systems use asynchronous terminals, known variously as ASCII (or ANSI) terminals, RS-232, or serial terminals. The serial ports on the back of most PCs are asynchronous terminal ports. Common modes for this type of terminal include DEC VT52, VT100, and VT220 emulation. This type of terminal connection is also the standard for most common modem connections.

Terminal emulation requires both the proper hardware interface, and the appropriate software to supply the communications protocol and character sets required by the host system.