December 12, 2005
The 451 Group has found that early adopters' use of utility computing points to an ongoing and growing change in the technology market. Grid computing is being used as a means to achieve a number of ends, utility computing being one of them. Most IT vendors and users see Grids and the attributes that give Grid computing its meaning -- virtualization, resource reallocation, automation and self-management -- as providing a technology underpinning for new kinds of IT procurement, delivery and usage models -- the most evident of which are service-oriented architectures and utility models. These findings appear in a report released today by The 451 Group, a New York-based technology industry analyst company focused on the business of enterprise IT innovation.
"Nearly all IT vendors are driving some notion of utility computing with Grid technology under the hood, and they are hoping that initial deployments for Grids and utility models within organizations will lead to wider enterprise use," said William Fellows, principal analyst at The 451 Group and main author of the report. "But at this point, adoption is minimal. Utility computing is not just around the corner, despite what vendors may suggest. Processing cycles and data access are not as fungible as electricity, and despite all the hype, it will take a lot of time and effort to turn everything into a service."
451 Group analysts found that the implementation of utility models implies several things: an ability to move from cost centers to computational utilities run on a commercial basis; links to external service providers for peak loads; the ability to move non-core assets off the balance sheet once IT resources are logically consolidated; and paying only for resources actually consumed. Although it's still early on, outsourcing, software as a service, "pay as you go" and subscription licensing models point to a broad, long-term change in the technology market and the way IT services are purchased.
"The desire to better align business with IT deployment and to automate processes suggests that early adopters will change the way they buy IT services in the long term," said Fellows.
The 451 Group believes that utility computing is a developing concept, but it is not yet a market -- although it certainly is being marketed. Utility computing means different things to vendors and early adopters, depending on whose interests are being served. Major IT vendors and integrators are experimenting with pay-as-you-go models as part of their on-demand strategies and as supplements to current outsourcing and hosted services. Early adopters are seeking providers that can supply capacity plus the application for a single price and without the user having to take care of the licensing. In addition, early adopters face a wide variety of obstacles and challenges when it comes to utility computing offerings, including: security, user resistance, immaturity of management and billing technology, software licensing, performance, presence of multiple vendors and products, and lack of developer and support expertise. Between IT vendors and early adopters, there is an area of consensus that "baby steps" on the road to "utility" models begin with server consolidation, virtualization, examination of metering and charge-back options -- and the streamlining of suppliers.
"Agility is a common word among early adopters. Often, the initial conversation about the use of Grids is focused on resource reallocation, lowering costs and total cost of ownership, but when Grids have been in use for some time, the conversation is increasingly rooted in the ability to better and more quickly respond to customer and internal requirements, address strategic business opportunities, do new things and improve time to market," said Fellows.
The report, "Grid Computing -- Where are we with utility computing?" is the eighth one in the 451 Grid Adoption Research Service (GARS) -- an investigation into user experiences and vendor strategies. The 59-page report was written by Fellows, with Steve Wallage, director of research, and Aidan Biggins, associate analyst. This report examines, in detail, the motivations and current frustrations of early adopters with the existing utility computing offerings, including the benefits they provide and how they are failing to deliver on their initial promise. A wide range of companies -- from telcos to IT vendors to metering specialists -- are examined to understand their particular perspectives and strategies. This report also analyzes the implications of current vendor and user activity and examines the role of Grid computing to assess the future for utility computing.
The report includes in-depth competitive assessments of the following vendor companies (although this is not a complete list of companies covered in various sections of the report): AT&T, CSC, EDS, Evident Networks, Hewlett-Packard, IBM, LeCayla, Oracle, RenderRocket, Savvis, Sun Microsystems, T-Systems and Wipro.
User case studies include the following early-adopter companies: CDO2, Deluxe Labs, Digital Ribbon, HSBC, OHM, Prediction and Turbine.
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When considering moving excess or experimental HPC applications to a cloud environment, there will always be obstacles. Were that not the case, the cost effectiveness of cloud-based HPC would rule the high performance landscape. Jonathan Stewart Ward and Adam Barker of the University of St. Andrews produced an intriguing report on the state of cloud computing, paying a significant amount of attention to the problems facing cloud computing.
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