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HolidayBuyer's Guide
Tech Industry

Is IT ready for a shakeup?

New thinking about the way companies buy technology could reshape the industry landscape, CNET News.com's Charles Cooper says.

Intel CEO Craig Barrett says there's no end in sight for Moore's Law. That's fabulous news for Intel, but is it necessarily so wonderful for the rest of us?

If you're an "early adopter," I suppose these remain the best of times. You'll soon have more speeds and feeds than you know what to do with.


Related story

Intel chief says momentum
will be kept up first
through conventional
manufacturing, then for
many years after that
by other technology.

But when CIOs learn about the hottest computer to roll off the assembly line or the newest software product under development, a lot of them simply cringe. The upgrade cycle turns IT managers into veritable hamsters, forcing them to run as fast as they can just to stay current with the latest and greatest.

Not that they have had much choice in the matter. The pace of technological advancement means a business can't stay pat: It either spends more to keep its IT infrastructure as good as the Jones'--or it falls behind the competition. A great racket if you're a supplier.

Until now.

The landscape has begun to change with the emergence of pay-as-you-go schemes, in which computer infrastructure gets leased. Some offer a subscription model, others treat it on a per-use basis--but the idea is essentially the same. Instead of paying for an expensive computer infrastructure, companies remain current with the newest technology by offloading the chore to any of the growing number of would-be candidates angling for the business.

The idea of time-sharing goes back to the early 1960s, when the mainframe was king. Time-sharing let companies use the hardware on a pay-per-run basis and afforded a cost-effective way for multiple terminal users to share processor power. This concept was updated for the era of distributed computing with the advent of grid infrastructures and various software-as-a-service models.

On the software side, this idea gained brief notoriety during the Internet heyday, but most of the service providers were poorly financed and flamed out when the economy turned south. That was unfortunate in more ways than one. Had the so-called ASP (application service provider) model for software delivery taken off in earnest back then, the hardware business would have undergone a similar rethinking.


Related newsmaker

Barrett approaches
official retirement,
but there's nothing
retiring about his demeanor.

History was only delayed, not derailed. How big any of this will become is a point of debate. Some dismiss it as just a warmed-over fad that won't long outlive its headlines. Others suggest that it will run aground on the shoals of entrenched resistance in big IT shops, where people naturally want to avoid outsourcing themselves out of a job.

This is still very preliminary. After all of the "next big things" that weren't, it's easy to become jaded. But if these fledgling attempts boom, the subscription model has the potential to reshuffle the current constellation of forces in the industry.

Sun Microsystems surely hopes so. The company has been in a funk ever since the collapse of the dot-com bubble. I've made no secret of my of CEO Scott McNealy's job performance. The company is at a critical crossroads, but I'm intrigued by its recent announcement of a subscription model with a yearly per-employee pricing plan. Though there's still some ambiguity about how to define CPU per-hour usage, Sun set a $1 per-CPU per-hour price.

It's too soon to tell whether this idea will set the computing world on its ear, but it could prove to be a harbinger for the industry--if it's a success.

Present at the creation? I wouldn't go that far just yet. But it's about time IT managers did more than grumble about underwriting planned obsolescence. They know--better than most--that when it comes to equipping their companies with the necessary new technology, there has to be a better way.