Friday, February 26, 2010

The Big Switch

Quite some time ago now I read Nick Carr's The Big Switch.

The basic premise is that just as we saw organizations move from producing their own electricity to buying electricity from a grid, we'll see this same dynamic play out in technology. Carr predicts that most organizations will stop buying and deploying large farms of computational power and storage, and will instead rely upon the "cloud" for their technology infrastructure instead. Carr also predicts that this shift will unleash new opportunities, markets, and challenges for business and the pubic.

Here's an even better summary of the book from Carr's web site:

A hundred years ago, companies stopped generating their own power with steam engines and dynamos and plugged into the newly built electric grid. The cheap power pumped out by electric utilities didn’t just change how businesses operate. It set off a chain reaction of economic and social transformations that brought the modern world into existence. Today, a similar revolution is under way. Hooked up to the Internet’s global computing grid, massive information-processing plants have begun pumping data and software code into our homes and businesses. This time, it’s computing that’s turning into a utility.

The shift is already remaking the computer industry, bringing new competitors like Google and to the fore and threatening stalwarts like Microsoft and Dell. But the effects will reach much further. Cheap, utility-supplied computing will ultimately change society as profoundly as cheap electricity did. We can already see the early effects — in the shift of control over media from institutions to individuals, in debates over the value of privacy, in the export of the jobs of knowledge workers, even in the growing concentration of wealth. As information utilities expand, the changes will only broaden, and their pace will only accelerate.

My sense is that Carr's right, and the shift is indeed already underway. For example, rather than buying storage devices - such as a NAS - and operating it locally at ICPSR, I'm much more inclined to rent storage from a provider. I'll only buy storage in those cases where there is some unique combination of requirements such that I have no choice but to purchase it, and (this is the expensive part) operate it myself.

As another example I see us continuing a trend of sourcing public-facing computational and storage resources as cloud instances rather than locally provisioned machines (or even virtual machines). I don't view virtualization as a great new technology that I can use to save money in running my machine room; I view it as a great new business that I can use to save money by getting rid of my machine room.

A similar switch or shift is also taking place with software systems. Our general strategy is to select existing technologies for delivering or managing content wherever feasible, and to spend our resources on software development only when there are no reasonable alternatives available.

Authoring and archiving announcements on the web site? Blogger.

Data leads tracking and management?

Delivering basic static web content with simple search for our sites that have no data? Drupal.

The real promise of this switch is in the potential it offers. Rather than using the IT shop as a simple service provider which automates business processes and therefore the transaction costs of operating ICPSR, it gives the IT shop the opportunity to be a partner in business process innovation. And when organizations actually reinvent themselves and change their fundamental business processes, that's when really interesting things can happen.

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