Red Herring writes:
Today, utility computing is the latest attempt at selling hosted applications. Recent technological advances like server virtualization (which makes unused parts of many computers function as one computer) make it easier for customers to share a data centers computing resources in ever-changing configurations to suit each customer’s needs. In theory, that flexibility helps outsourcers charge for the use of processors and disks much like an energy company charges for electricity by the kilowatt-hour. In a prediction reminiscent of the rosiest forecasts of the ASP era, market research firm IDC says worldwide spending on utility computing will grow from $1 billion last year to $4.6 billion in 2007. But VCs still smarting from the ASP bust arent chasing that anticipated windfall by investing in utility-computing outsourcers. Instead, they are placing bets on companies that make hardware and software for utility-style data centers.
Virtualization software presents an administrator with a view of all the available computing, storage, and networking gear in a data center. By selecting an unused processor on one machine and some disks and memory on another, the administrator can fashion a virtual server to run a new application or supply extra computing power on demand without installing additional hardware.
A close cousin of virtualization is server blade technology, another hot area for utility-computing startups. Blades are removable boards containing processors and other server components. Administrators can swap them in and out of racks to provide computing power as needed.