The End of Corporate Computing?

Dan Farber discusses a Nick Carr article:

Carr argues that the shift from IT as a fragmented capital asset to a centralized utility service will create far more upheaval than the introduction of the PC and the Internet did in past decades. I think thats a bit of an overstatement, unless he is talking about the impact over time on companies that deliver IT solutions today. Broadband connectivity anytime, anyplace is a good example of a rudimentary utilty model in action, and, as Carr writes, it will be driven by continued innovations in virtualization, grid, Web services and other technologies: “Most of the broadly used components, from computers to operating systems to complex enterprise applications that automate common business processes, will likely be purchased as cheap, generic commodities.”

Carr suggests that IT utilities will pose a problem for companies such as Dell, Microsoft, SAP and Oracle, which thrive on selling direct to multitudes of corporate customers. The winners will come from the full-service vendors like IBM, HP and Sun; established hosting providers like VeriCenter in Houston; the Web utilities like Google, Yahoo and Amazon that have expertise in building large-scale infrastructure; and as yet unknown start-ups.

As Carr notes, “the biggest impediment to utility computing will not be technological but attitudinal.” The first wave will come from the symbiosis between the early utility hardware providers and the early utility software-as-a-service providers. Carr pointed to Achieve, a provider of software for the healthcare industry, which uses a VeriCenter data center as its infrastructure for its solution.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.