It was once quite common to have a centralized server with a variety of external terminals.. that's a concept that is still a criticial part of Unix systems.
Traditionally people interfaced with a Unix server over a serial link, directly over modems.. if you look into the history of X, you'll see it's heavily based on a server-client architecture.
http://en.wikipedia.org/wiki/X_terminal
Many thin-client systems have existed over the years, but it soon became quicker and more affordable to use dedicated workstations with their own local hard disks and graphics cards.
http://en.wikipedia.org/wiki/Thin_client