Will computing flow like electricity?

As a provocateur, he's very effective. But as a prognosticator, people are less convinced.

Business writer Nicholas G. Carr raised many hackles in the information technology industry when he published a piece entitled 'IT Doesn't Matter' in 2003.

His latest piece, with a similarly extreme headline, 'The End of Corporate Computing', reopens the discussion of utility computing -- the notion that corporations subscribe to computing services over the Internet much as they purchase electricity.

Yet Carr's latest article, published earlier this spring, failed to spark much industry soul-searching or a heated debate on the future of corporate computing.

IT executives queried by CNET.co.uk's sister site News.com agreed that hosted services, or utility computing, will become more common and that corporations will take advantage of new technologies, such as Web services, grid computing and virtualisation, to lower computing costs.

However, few executives envision a whole-scale transition to utility computing, even in the far-off future. None appeared to buy into Carr's assertion that the balance of power in the computing world could shift dramatically from technology infrastructure providers to Internet companies, such as Google or hosting companies.

For example, Charles Giancarlo, the chief technology officer of Cisco, downplayed the importance of utility computing scenarios. Like many others, Giancarlo said hosted services will become more important in certain situations, but utility computing services will not be the norm in three to five years.

"We think utility computing makes sense for some small and medium-size businesses. But for large businesses, the decision to host applications outside or inside of the network depends on many different factors, including cost and network efficiency," said Giancarlo. "Some of the largest companies can run their own applications much cheaper and more efficiently than any utility computing provider."

Other executives said that Carr's prediction that utility computing will become the industry norm is predicated on improper assumptions about the complexity of computing or blind spots in his knowledge.

In particular, Carr downplays the competitive advantage that custom-built software applications can bring, compared to hosted offerings, said Eric Newcomer, chief technology officer at software maker Iona Technologies.

"Computers do not work without software. And unlike electricity or other raw technology, software is designed for direct human interaction," Newcomer said. "Overall, Carr has taken a very interesting analogy with some truth in it to an implausible extreme."

Meanwhile, readers of CNET News.com, who responded to a news story on Carr's 'End of Corporate Computing' piece, voiced a mix of opinions.

"The notion of the computer as computing device has been obsoleted by the Internet. All of the real action these days is in using the computer as a *communications* device," wrote one reader.

Others said that utility computing has yet to prove indispensable to corporate customers.

"I'd suspect that IBM's old mainframe philosophy is behind this drive to utility computing. It's very easy to bill by the month and provide premium services by the hour," wrote one reader. However, he questioned the need for these services: "I'm not aware of any pressing need that can only be met by utility computing."

Data centres obsolete?
To frame his discussion in the 'End of Corporate Computing', Carr uses the analogy of the electricity industry and its own development over a century ago.

Carr argues that corporate computing data centres are analogous to private generators, which were used in the early days of electricity. These power sources burned fuel to generate electricity for a single site, such as a department store or a wealthy person's home. Tycoon J.P. Morgan was the first residential customer in New York City in the late 1800s.

But private and small-scale power generators, which used direct current, were eventually displaced entirely by alternating-current technology, which allowed utilities to send electricity over long distances, obviating the need for a local power plant and the people to run it.

To Carr, today's corporate data centres are the private power generators of old: inefficient, underutilised and too costly in the face of the network model of delivering IT services.

"As the technology matures and central distribution becomes possible, large-scale utility suppliers arise to displace the private providers. Although companies may take years to abandon their proprietary supply operations and all the sunk costs they represent, the savings offered by utilities eventually become too compelling to resist, even for the largest enterprises. Abandoning the old model becomes a competitive necessity," Carr wrote.