Everything as a Service

Hewlett-Packard (NASDAQ: HPQ) recently outlined its long-term business and innovation strategy: “Everything-as-as-Service.”

The phrase conjures images of software-as-a-service (SaaS) and of cloud computing, and introduces an entirely different concept of how enterprises, solution providers and vendors use IT within the business environment. While this notion has been floating around for a couple of years — think Google and Salesforce.com — there is a sizable expectation that service offerings will become more abundant in the coming years.

One of the key expectations is that data will be pushed out of the data centre. We’ve seen this already on the small business front, as small business owners opt for storage solutions over the Internet. However, there is now an expectation — largely from the vendors at this point — that this trend will shift into the mid-sized and large enterprise space.

This paradigm shift raises some interesting questions with respect to:
*IT suppliers
*Hardware and software purchase strategies
*Storage requirements
*Security concerns
*The role of IT departments
*The role of solution providers

Time will provide the answers. However, in the meantime, we can make a couple of predictions:

*Application development will be a valuable skill to have in the tool box. Wrapping software applications, either existing or downloaded from the cloud, into legacy applications is going to be critical to the successful management of IT.

*There will be a shift towards developing a “managed IT services” strategy, compared to the sole “acquisition” strategy of the past, leading to the emergence of a new business model.

*IT is emerging as a strategic business line, and not just an expensive cost-centre.

Some of the implications for solution providers:

*The shift towards managed services provides the opportunity for a more strategic and varied customer relationship, compared to simply providing parts delivered on time.

*It will become increasingly more challenging to sell the large IT solution. The shift towards “leasing” hardware and software services as needed, versus approving an outright large scale acquisition, will render the large solution as a more challenging sell.

*However, the leasing option “everything-as-a-service” opens the door for partnership opportunities.

The push right now is for smaller companies, and consumers, to embrace “everything-as-a-service”. Once customer acceptance increases at this level, the likelihood of enterprise adoption might pick up. Solution providers will have to be ready for the challenges and for the opportunities this trend will bring.

Michelle Warren is a senior analyst with the London, Ont.-based Info-Tech Research Group.

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