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IT Isn't (Just) Electricity

My esteemed colleague, Steve O’Grady’s notes from OSBC reminded me of the old “IT is like electricity” line of thought that’s been kicking around. The analogy goes that IT will become so standardized and cheap that it will be a commodity just like electricty. You’ll just hook IT up to your business like plugging in a toaster, get a monthly bill, and that’ll be it. There won’t be a need for all those “Mr.” guys in Microsoft ads.

The original idea (from Jonathan Schwartz, I believe) has transformed into a much more wide-sweeping one: that all IT/”computers” will be comoditized, so all you IT people out there better start figuring out a new way to pay the mortgage.

A Fresh Look

This broadened version of the analogy leaves out a crucial part, explained here in a condensed version of Schwartz’s larger post on the topic:

As with electricity, though, we’ll need to create mechanisms for defining a unit of computing power and pricing it. We’ll need to create reliable and secure delivery mechanisms. We’ll have to create the things that turn this commodity into real value for consumers, the way electric irons, washing machines and water heaters did. And as consumers of computing, we’ll need to take a fresh look at the role of “technology” in business and our daily lives.

A commodity, and any IT, is worthless without the reasons to use it. For electricity, those reasons are light, toasting bread, keeping food and drinks cool and frozen, powering computers: all the exciting, 20th century devices we plug into outlets. For IT, those reasons are a company’s business applications and ultimately, making money. For the rest of us, the reason to use IT are consumer devices like the iPod, TiVO, VoIP, reading, and entertainment.

Gold Bricks

Sure, all that hardware, networking, and basic software (OS’s, security, email, and web clients, etc.) might get cheaper, more standardized, and more commidified. The reason a company buys one piece of IT hardware may be purely marketing, like why you buy one brand of toilet paper over another.

But you’ll still need something to do with it all those boxes and bandwidth. More importantly, businesses are still going to want that commidified IT to fit with their business instead of force the way they do business. That is: there will always be customization and even more one-offs. Customization is what a commodity is terrible at: any irregularly sized person shopping for clothes can tell you that. Like gold and silver, few people want bars of gold and silver for a Valantine’s gift, they want the customization of those commodities: jewelry.

In the same way, companies don’t just want big chunks of hardware as if they were electricity, they want those chunks shaped into something that helps them make money. And, as Carr’s trouble-making alludes to, that’s where the people of IT will find their pay-checks: moving up the value chain from IT to business. To put it another way, IT (both vendors and those who run IT) needs to stop caring about how much it rocks, and care more about how their customers use the IT to rock.

Categories: Enterprise Software.