FOWA 07: Simon Wardley – Commodisation of IT and What the Future Holds

Sponsor slot

Commoditisation. Formal definitions is “a change from monopoly to perfect competition”

yesterdays hot stuff –> today’s boredom
how novel, exciting and new –> uninteresting, unloved and taken for granted.

EG, electricity, Exciting in 1890s. It mattered, it provided new competitive opportunities, could replace people with machines. 1930s we had the national grid.

Rare thing becomes a common thing, ubiquitous, distributed.
When something is novel and new, it provides a competitive advantage.
When it is common it becomes just the cost of doing business.

1990s, web sites were novel and new, so web designers were hot. We made a different, created a competitive advantage. Except we didn’t – all that was happening was a big IT arms race, everyone wanted bigger and better IT. And if you weren’t armed, you were history.

New thing > leading edge > standard products > utility service

Constant move towards commoditisation. IT is not a strategic choice, it is a cost of doing business.

Software as service
Utility computing
Web 2.0 – implies there are things that are old had and commonplace
Can’t insist on oodles of cash to build what we used to build. Now people want commonplace as cheap as chips. What should be cheap? Operating environments. No competitive advantage on having your own web infrastructure. Is a phrase for this competitive market – yak shaving. Doesn’t makes sense to do things over and over, pay someone else to do it .What is needed is an environment to build and release what you want and pay for what you use, e.g. Amazon S2.

Zimki. Build what you want without ever going near a database. problem of vendor lock-in, so Zimki is open sourcing everything. Will be able to switch environment, take your app and go elsewhere, or sell resources back. More like the national grid idea. Balance supply and demand. Lots of waste in hosting, and when there is waste there is opportunity, both financial and environmental.

Commoditisation is a growing trend and if you’re not looking at it you can bet your competitors are.

Technorati Tags: ,