What's It All About

In enterprise IT today, overcapacity is about as popular as, well, the Macarena. It's just so last-century to have hardware sitting around idle, or software licences that are yet to be used, the now legendary "shelfware", followed closely by the term "offware", as in offing software vendors from your approved-vendor list. Today, the game is all about efficiency, making do with what you've got and least of all spending more money on IT infrastructure. Increasingly, the thinking goes, this efficiency game means "selectively" outsourcing certain aspects of your company's IT workload to better manage existing resources, meet new business needs in a more affordable, bite-sized manner, and keep squeezing more performance, more return out of IT, to deliver more business value.

The industry seems to agree that asset-based IT is increasingly not a realistic option for today's businesses. Companies will continue to seek ways to reduce IT risk and the costs associated with excess IT capacity. What's more, the ability to quickly scale IT infrastructure - up or down - remains a prime requirement for most firms. Information technology is becoming, quite simply, more about services and access and less about hard assets.

Collectively, the major vendors and industry analysts backing this new IT model do bring significant credibility to the concept. They see it as a burgeoning era of opportunity, productivity enhancement and cost-efficiency in IT, for businesses of all sizes and stripes. And the way they define it is about as common man as you can get: delivering computing resources the way a power utility dispenses electricity. Meaning you, as the customer, are billed only for the processing power, network bandwidth and software applications you actually use. From the vendor side, running this new model involves using a shared IT infrastructure environment at a hosting centre. That can include software applications, for which customers' usage is tracked for billing purposes. If that sounds familiar, it is; essentially it's the application service provider (ASP) model. But the big players will convince you that utility computing is much broader than that.

Companies can have reserve servers or storage capacity, for example, in anticipation of a spike in demand. Only when these extra resources are needed does a customer staff person activate them remotely, and no billing occurs until that point. Thus, customers can take advantage of a variety of shared infrastructure resources, from storage to databases to Web servers, as opposed to simply outsourcing individual applications.