How Utility Computing Works

Weren't computers supposed to simplify our professional lives? Early advertising for personal computers claimed that customers could finish a day's work in a couple of hours using a single device. Some people hoped that computer filing systems and e-mail would create a paperless work environment and eliminate issues of miscommunication.

For many companies, the truth about computers is more complicated. It's difficult to predict accurately where problems might occur. On top of that, computer hardware and software evolve rapidly, partly because the computer industry is filled with competitive companies striving to offer the best products and services. Committing to a particular computer platform, operating system and suite of software isn't always an easy decision, particularly when setting up a network of machines.


While individual tasks might be easier to complete thanks to computers, the machines themselves can be challenging to maintain and repair. Many companies spend millions of dollars on IT support to keep computers and applications running properly. Even something as simple as adding a new application to a computer network can cause unexpected problems.

Some corporate executives are looking outside their companies for solutions. One potential approach is to use utility computing. Basically, utility computing is a business model in which one company outsources part or all of its computer support to another company. Support in this case doesn't just mean technical advice -- it includes everything from computer processing power to data storage.



What's the low down on utility computing? Keep reading to find out.


The Basics of Utility Computing

The principle of utility computing is very simple: One company pays another company for computing services. The services might include hardware rental, data storage space, use of specific computer applications or access to computer processing power. It all depends on what the client wants and what the utility computing company can offer.

Many utility computing companies offer bundles or packages of resources. A comprehensive package might include all of the following:


  • Computer hardware, including servers, CPUs, monitors, input devices and network cables.
  • Internet access, including Web servers and browsing software.
  • Software applications that run the entire gamut of computer programs. They could include word processing programs, e-mail clients, project-specific applications and everything in between. Industry experts call this particular kind of business "Software as a Service" (SaaS).
  • Access to the processing power of a supercomputer. Some corporations have hefty computational requirements. For example, a financial company might need to process rapidly-changing data gathered from the stock market. While a normal computer might take hours to process complicated data, a supercomputer could complete the same task much more quickly.
  • The use of a grid computing system. A grid computing system is a network of computers running special software called middleware. The middleware detects idle CPU processing power and allows an application running on another computer to take advantage of it. It's useful for large computational problems that can be divided into smaller chunks.
  • Off-site data storage, which is also called cloud storage. There are many reasons a company might want to store data off-site. If the company processes a lot of data, it might not have the physical space to hold the data servers it needs. An off-site backup is also a good way to protect information in case of a catastrophe. For example, if the company's building were demolished in a fire, its data would still exist in another location.

Utility computing rates vary depending on the utility computing company and the requested service. Usually, companies charge clients based on service usage rather than a flat fee. The more a client uses services, the more fees it must pay. Some companies bundle services together at a reduced rate, essentially selling computer services in bulk.

What are the pros and cons of utility computing? We'll explore that in the next section.


Utility Computing Advantages and Disadvantages

For most clients, the biggest advantage of utility computing is convenience. The client doesn't have to buy all the hardware, software and licenses needed to do business. Instead, the client relies on another party to provide these services. The burden of maintaining and administering the system falls to the utility computing company, allowing the client to concentrate on other tasks.

Closely related to convenience is compatibility. In a large company with many departments, problems can arise with computing software. Each department might depend on different software suites. The files used by employees in one part of a company might be incompatible with the software used by employees in another part. Utility computing gives companies the option to subscribe to a single service and use the same suite of software throughout the entire client organization.


Cost can be either an advantage or disadvantage, depending on how the provider structures fees. Using a utility computing company for services can be less expensive than running computer operations in-house. As long as the utility computing company offers the client the services it needs to do business, there's no need for the client to look elsewhere. Most of the cost for maintenance becomes the responsibility of the provider, not the client. The client can choose to rely on simplified hardware, which is less expensive and can be easier to maintain.

However, in some cases what the client needs and what the provider offers aren't in alignment. If the client is a small business and the provider offers access to expensive supercomputers at a hefty fee, there's a good chance the client will choose to handle its own computing needs. Why pay a high service charge for something you don't need?

Another potential disadvantage is reliability. If a utility computing company is in financial trouble or has frequent equipment problems, clients could get cut off from the services for which they're paying. This spells trouble for both the provider and the client. If a utility computing company goes out of business, its clients could fall victim to the same fate. Clients might hesitate to hand over duties to a smaller company if it could mean losing data and other capabilities should the business suffer.

Utility computing systems can also be attractive targets for hackers. A hacker might want to access services without paying for them or snoop around and investigate client files. Much of the responsibility of keeping the system safe falls to the provider, but some of it also relies on the client's practices. If a company doesn't educate its workforce on proper access procedures, it's not hard for an intruder to find ways to invade a utility computing company's system.

One challenge facing utility computing services is educating consumers about the service. Awareness of utility computing isn't very widespread. It's hard to sell a service to a client if the client has never heard of it. Now that you've read this article, you're ahead of the game.

As utility computing companies offer more comprehensive and sophisticated services, we may see more corporations choosing to use their services. Eventually, it's possible that computers in data centers miles from your home or office will handle all your computational needs for you.

To learn more about utility computing and related topics, follow the links on the next page.


Frequently Answered Questions

What is utility computing with example?
Utility computing is a type of cloud computing that bills customers based on their use of computing resources. For example, a customer may be charged based on the amount of storage they use, the amount of computing power they use, or the amount of bandwidth they use.
How is utility computing used?
Utility computing is a term used to describe a pay-as-you-go model for supplying IT resources on demand. In a utility computing model, IT resources are provided as a metered service, and customers are only charged for the resources they consume.
What is meant by utility computing?
Utility computing is a service provisioning model in which a service provider makes computing resources and infrastructure management available to customers on a pay-per-use basis.

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