Economic crisis to boost utility compute market

Several utility computing service providers are expecting the current economic crisis to catalyze Asian companies to adopt their services amid shrinking budgets.
Written by Victoria Ho, Contributor

Several utility computing service providers are expecting the current economic crisis to catalyze Asian companies to adopt their services.

Horst Iblher, director of sales support and service management at T-Systems told ZDNet Asia, the German ICT provider is receiving increasing interest in the region in its leased computing platform service. While Asia lags behind Europe and the United States in its rate of adoption of utility computing, Iblher said this is picking up speed "especially in economically-troubled times".

"The rate of take-up for utility computing is significantly higher in Asia, albeit coming from a lower base," he said in an e-mail.

Aye See Tan, managing director, Asia-Pacific at Savvis, said customers are "opening up" to the concept. While awareness levels have risen, adoption has been slow in past years, with companies opting to own and manage their own IT infrastructure, said Tan.

But budget cuts next year will likely push companies to turn to options that can cut buying costs while keeping existing IT operations afloat, she noted. Many of Savvis' customers have opted for a combination service of managed hosting, utility computing and virtualization to host their business applications.

Utility computing is gaining popularity at a time when businesses need to preserve capital expenditure so they can recover quickly when the economy regains momentum, Tan added.

Iblher credits the recent cloud computing hype with the market's opening up to "be more receptive to the idea of leased computing". Users are aware of the need for "dynamic" services which scale alongside usage, which is one of the tenets cloud theoretically provides. There has been a "clear trend" in the tenders and RFPs (requests for proposal) from companies requesting for such leased computing services that adapt to usage, he said.

But legacy issues may pose a barrier to the quick uptake of utility computing, even if they can be overcome. Iblher said T-Systems first looks to ensure stability before embarking on a migration process involving moving data and applications from the customers' existing infrastructure onto T-Systems' environment.

Tan said organizations that are "very specific" on hardware choice and are not ready to move from an in-house implementation to managed services, may require a move over several phases. She said organizations' worries over legacy migration can be "easily overcome" by focusing on serving major business imperatives over technological goals with the implementation.

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