Adding It All Up

Service provider Citec is based in Brisbane and is making its first steps towards harnessing the potential of the utility computing model. Peter Geale, director of infrastructure management for the organisation, says that utility computing is really bringing to the open systems world what bureau processing services delivered in the mainframe era. Citec provides utility services to a small band of clients, and also makes use of the service itself for information brokerage.

Geale says one of the issues that needs to be tackled upfront is how the cost of the service is calculated. For utility storage this is quite simple as it can be calculated as terabytes per month. But it's harder to calculate service cost for computer processing, Geale admits. "One of the challenges is - what do you measure? Should it be the number of processors used, or the number of SAP transactions per minute, or the number of seconds per transaction, or the time to complete an end-of-month payroll?"

To some degree though, what Citec is selling is just a new way of delivering outsourced services. Geale says that in the future more sophisticated technology will allow the company to construct and sell more flexible "virtual computing environments" where payment for information services could become extremely granular, which is the ideal for a utility model.

According to Geale, the decision to experiment with the utility model is one that needs to be considered jointly by the CIO, CEO and CFO, especially as it might involve a change in the way computer power is accounted for on the balance sheet. But he also sounds a shrill warning note for CIOs regarding the need for a full risk assessment of their vendor, infrastructure, support services and backup. "Utility computing will only be as good as your weakest link," Geale says.

And an information blackout is something companies can ill-afford, no matter how glittering the economic lure of utility computing.

SIDEBAR: The Odd Couple

Everything old is new again

Although Web services are not equivalent to utility computing, they are an enabler of utility computing and perhaps an indicator that if the idea of shared data is gaining popularity, so ultimately might sharing services.

Bruce McCabe, director of S2 Intelligence, believes there are somewhere between 100 and 200 live examples of Web services in Australia and that demand is on the rise. As these early Web services adopters have discovered, it will be essential for any company considering a move to utility computing to conduct a full risk assessment ahead of embarking on such an initiative. And one of the key elements of risk at present is security, where the lack of a fully fledged standard is proving limiting to the way in which Web services can be deployed.

At present not all the standards are well established for Web services, particularly with regard to the security layer. Consequently companies are having to keep a close eye on emerging standards and limit applications to where data security is not a critical priority. The same will hold true for utility computing where the standards debate is in its infancy.

McCabe recommends anyone considering Web services should also conduct an audit at the outset in order to identify which data might lend itself to a Web services treatment - and the same holds true for utility computing, he says.

And just as with Web services where, according to McCabe, "people are not generally retrofitting Web services onto stuff that has already been integrated", organisations might not consider utility computing for existing applications just yet, but might experiment with a utility model for new applications where it makes sense.

It is a case of cutting teeth rather than cutting throats.