Utility Computing

The idea of utility computing is that you can pay for the IT services, such as computation and storage, in the same method as paying for your electricity or gas. This process does not require the customer to actually have to buy the hardwares needed. [1] The power plant-like computing systems will be able to operate at a remote data center and deliver, for example, to a company’s office. IBM has identified three technological trends that make utility computing possible: reduced cost of bandwidth; distributed content and application architecture deployments that shift delivery to the edge of the network; and server and storage virtualization. Some of the technology of utility computing is real today. An example of that would be HP’s Utility Data Center, a switching device for doling out computing jobs. Another example is Veritas Software Corp.’s software that predicts when extra storage capacity is going to be needed. However, one obstacle that prevents this concept to be ready for mainstream corporate use is grid computing. This should be resolved in the near future. IBM has also created this vision for utility computing which it calls e-business on demand. It could be seen as a step further from the traditional IT outsourcing. E-business on demand adds several improvements to it, including: business processes, bandwidth, hardware, middleware, software and managed services. [2]

So what is it like when e-business on demand is fully developed? You will be able to form networked communities so that organizations can create new products and services faster, reach new customers and economically add new relationships, dynamically change existing relationships, simultaneously engage in multiple e-business models and improve access to information by constituents involved in these relationships. All these will result in an increased share of customer spending, a better return on assets, new revenue opportunities and better shareholder return. And what are the characteristics that a future on-demand business has? It is sensitive to environmental changes. It has the ability to react smartly responding to changes in supply or demand, emerging customer, partner, and supplier and employee needs. It is able to adapt business processes easily: to drive performance in a more efficient way, to reduce cost and increase efficiency. Also, it is able to use tightly integrated strategic collaborators to manage different tasks including manufacturing, logistics, and fulfillment to human resources and financial operations. It should also be constantly alert for situations like computer viruses, earthquakes, or sudden spike in demand.[3] And with the help of utility computing, organizations are able to better fulfill these tasks. There is also a negative aspect of this technology. If the utility data center is down, for the period of time that it is down, the company that depend its operations on it would lose money.



Gutierrez, A. (2003, February 17). E-business on demand: A developer’s roadmap. Retrieved September 24, 2007, from http://www.ibm.com/developerworks/ibm/library/i-ebodov/

Thomas, A.(2003).The Next utility: e-business on demand[Electronic Version]. Network Magazine. Retrieved September 24, 2007, from http://www.networkmagazineindia.com/200301/cover4.shtml

Wikimedia Foundation, Inc. (2007).Wikipedia, the free encyclopedia. Retrieved from September 24, 2007, from http://en.wikipedia.org/wiki/Utility_computing