Utility Computing Explained!

Do you consider the amount of water used by your company to be a strategic factor in its success? Or how about the amount of electricity used? It sounds bizarre doesn’t it? Yet we often talk in terms of the power of our IT systems or the amazing amount of storage our systems offer.

Isn’t the corporate use of computing processor power or storage just another service that can be metered and delivered as a utility, just like gas, water, and electricity? That’s the utility computing model.

Utility computing has been around in theory for a long time, but it’s only been the last few years that suppliers have been actively pushing it as a viable way of billing for their services.

Nicholas Carr outlined the utility concept in his book ‘Does IT Matter?’ A book that caused a lot of controversy on its release six years ago as it challenged the way most IT departments work. Carr said: "When a resource becomes essential to competition but inconsequential to strategy, the risks it creates become more important than the advantages it provides. Today, no company builds its business strategy around rail service or electricity, but a lapse in the supply of these resources, or a spike in their cost, can be devastating."

The problem has always been that the concept of computing as a utility is great, but the reality of billing is harder to get right – for both customer and supplier. But it’s not just a theoretical construct. Think of some scenarios where rented infrastructure and flexibility might be important. How about a retailer doing ninety per cent of their business in the month before Christmas? Or a start-up firm not sure if they are going to grow twenty per cent or two hundred per cent this year? Or a train reservations service coping with a spike in enquiries as flights are cancelled because of the Icelandic ash cloud?

Advocates of the utility computing model claim the following benefits:

Responsive ; there is no way a local IT department can react to spikes and troughs in demand for power and storage in the way demand can be ramped up and down using the utility model. Cost efficient ; there is no capital expenditure up front for servers, property, staff, or anything else needed to support a large data centre. You just pay for the service as and when you need to use it. Flexible ; services can be adjusted with a single request to the supplier and don’t involve purchasing new equipment. Reliable ; you get guaranteed service with load balancing across sites and other business continuity measures. Secure ; you get industry-standard security measures built into your data centre without needing to arrange it yourself. There are critics who believe that the utility model – and the wider cloud idea – is just a bubble, a great idea with vocal supporters, but ultimately doomed. There are others who suggest that the reliance on communications networks means that security in inherently compromised.

I saw a conference speaker recently asking those questions, and then he turned to the audience and asked them to raise a hand if they refused to do any personal banking on the Internet because of security concerns. Not a single hand was raised. The point was clear – if a group of IT managers trusted their network with their personal banking details then why would it not be safe for their corporate storage needs?

Utility computing is still the preserve of the larger IT suppliers, but it’s gaining currency amongst smaller suppliers who see it as a way of winning recurring business they could never have won using the old model. It’s an idea whose time has time.