Sun’s Utility Computing writes:

The program, called the Secure N1 Grid, will cost $1 per processor per hour to use.

“Sun does well when they get to rewrite the rules of the game,” said Clay Ryder, an analyst at the Sageza Group. But when it comes to novel pricing plans, it takes years to change customers’ buying behavior.

Schwartz is moving to make Sun’s products available in three ways: the standard one-time sales method that is prominent today; subscriptions that bundle products and services; and utility plans for which payments increase or decrease according to the consumption of computing resources.

The company’s grid program offers servers using its UltraSparc processor or Advanced Micro Devices’ Opteron processor, a variant of the x86 chip family popularized by Intel’s Pentium and Xeon products, said Terry Erdle, vice president of marketing for Sun’s worldwide services and solutions group. Customers can rent a “grid” of interconnected computers that can be used for calculation tasks such as computing financial risks, searching seismic data that can locate oil fields and detailing frames in animated movies.

Sun’s not first with the idea of renting out supercomputer power, a service often geared for customers that have surging processing needs. IBM launched its program more than a year and half ago with oil and gas customers, expanding later to biology and genetics research. And HP this year began renting computing brawn to entertainment industry customers.

ZDNet has more:

Sun hopes that it eventually will blossom so that organizations such as stock exchanges with extra processing power can sell it back to a computing grid in the same manner that homes with solar panels can sell power back to the electrical power grid.

“If the exchanges are dormant at night, they can feed capacity back to the network,” Schwartz said. He cautioned that such a vision requires security technology to protect computing tasks from tampering.

But such challenges will be solved, and Sun hopes to profit by running computers others can use.

“How big could the market be for this service? Add up the total number of hours used by all computer users on the planet,” Schwartz said. “In the long run, all computing will be done this way.”

Schwartz believes that general-purpose business computing tasks will come later, though the speed of light and other networking lags mean that geography hobbles many transaction-processing tasks that demand fast responses. “Over time, we’ll look at the technology hurdles necessary to get to a true service grid,” he said.

In this vision, Sun expects to run data centers packed with computers, but not generally to sell the computing power to customers. “We’re looking at partners to deliver retail services to customers,” he said.

Jonathan Schwartz writes on his blog:

here’s a view on why this is one of the most important announcements we’ll make this year: what Google, eBay and are proving are the economics of using someone else’s uniformly standardized infrastructure to run your business. Sun’s business, historically, has been the opposite – we deliver infrastructure to customers who work with us to customize that infrastructure to unique workloads. What and others prove is that there are some workloads for which the reverse can be true – mapping the workload, like salesforce automation, to a singular service provider with a common infrastructure, yields savings from economies of scale that vastly outweigh any potential expense in changing workflows/workloads. The ASP (application service provider) model is, in fact, a great model.

One man’s virtualization is another man’s web service. The era of mapping workloads to network service infrastructure is officially underway.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.