Caching is very useful even for a two-user office. Most offices allow Internet access for business use. If users are looking at similar pages, the cached pages will be returned much more quickly to the users. We have implemented ISA Server as caching solution for offices with as few at five users, and they have uniformly commented on the improved speed of access.
Remember that caching's primary utility is to improve perceived performance, not to save on bandwidth costs. However, pages that are retrieved from cache do not utilize bandwidth on the external interface, which makes more bandwidth available for other purposes. While Web browsers do have their own cache, other users on the network cannot take advantage of what's in your cache. The Caching Proxy creates a "community" cache that all users on the network can take advantage of.
So, caching servers are definitely NOT a thing of the past. Instead, they are just coming into their prime.
This was first published in March 2002