Whether you prefer the term "utility computing" or "the cloud," the industry is headed in that direction, however slowly, and the transition will have a multifaceted impact on IT in some ways productive, others unpleasant. And it will strike to the heart of the very technology professionals who provide a significant chunk of what is today's enterprise IT.
InfoWorld: There are those who would say that The Big Switch is something of a shift away from your position in "IT Doesn't Matter." Is that true?
Even as far back as my original HBR article " IT Doesn't Matter," one of the basic arguments was that more and more of the IT that companies are investing in and running themselves looks a lot like infrastructure that doesn't give you a competitive advantage.
I even made an analogy with a utility that everybody has to use but becomes over time pretty much a shared infrastructure. And so what happens when most of what companies use is indistinguishable for what their competitors use? Doesn't that mean we'll move toward more a shared infrastructure, more of a utility system?
The rise of cloud computing in general reflects the fact that a whole lot of the IT that companies have been investing in is really better run centrally and shared by a bunch of companies than it is maintained individually. Now, having said that, I see it as a logical next step from "IT Doesn't Matter."
On the other hand, you could say that if a company is smarter in how it takes advantage of this new technological phenomenon, it might at least get a cost advantage over its competitors. So at that level, you can say there's some tension between the idea that you can't get an advantage from technology and what we're seeing now with cloud computing.
InfoWorld: A shift toward IT as a utility will be long-term. It's happening in really small ways, such as Salesforce.com, but in the here-and-now, not a lot is going on. So do you have a timeline for this?
It's a 10- to 15-year period of transition. Particularly if you look at large companies, big enterprise users, that's probably about the right timeframe. They have huge scale in their internal operations, and it's going to take quite some time for the utility infrastructure to get big enough and efficient enough to provide an alternative to big private datacenters.
I completely agree that we're in a transition period that's going to take some time. And I'd say at this moment that the hype about cloud computing has gotten a bit ahead of the reality. Still, the uptake of cloud services over the last year has moved faster than I would have expected. So there is a lot going on, but there's still a long way to go.
InfoWorld: Indeed, and there's also a human element at play. IT folks are in the position to push back on cloud services, if only to preserve their own jobs. How do you envision that playing out?
Well, there is a basic conflict of interest that IT departments face as they think about the cloud, and that's true, of course, of any kind of internal department that faces the prospect of being displaced by an outside provider. We also saw some of this with outsourcing as well, so it's not necessarily new.
What I think is more powerful than the resistance that may come from IT departments looking to protect their turf is the competitive necessity companies face to reduce the cost of IT while simultaneously expanding their IT capacity -- and the cloud offers one good way to do that.
What I mean by competitive pressure is if one of your competitors moves to more of a cloud operation and saves a lot of money, then whether your IT department likes it or not, you're going to have a competitive necessity to move in that same direction. Over time, that is going to be the dynamic of why cloud computing becomes more mainstream.
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