Innovation Journal on Ulitzer

The time has come to declare that the beginning of the end for the traditional approach to Information Technology.  The party is over.

The End of IT 1.0 As We Know It – has begun.  To borrow a phrase from my previous IBM colleagues who wrote, “The End of TV As We Know It” with which I became familiar while working on IP Television (IPTV).

You may wonder whether it’s too early to make the call given the lack of interoperability standards, security concerns, and common definition of cloud computing.  Well, the IPTV space shares many of the same similarities – emerging technology, emerging standards, emerging adoption, varying definitions, and yet the call was made in that space.

Cloud computing is a shot across the bow for the giants of the IT industry.  They are on notice.  Certainly, some will make the transition, slowly, at the speed which the overall market develops or slower, as they have no incentive to drive the market and rapidly cannibalize their existing businesses for a less lucrative business model even if it is more cost effective, flexible, and efficient for most of their clients.

Just think of the companies that provide hardware, software, services, consulting and systems integration.  Now consider the cloud computing paradigm.

• No packaged software to order, install, configure, test, implement, manage, support, and maintain on client premise.
• No hardware to order, install, configure, test, implement, manage, support, and maintain on client premise.
• No hardware and software / systems integration on client premise.

Now look at the companies that provide these services today, EMC, HP, IBM, Oracle, SAP, Accenture, Infosys, and others.  Are these giants ready to quickly accelerate the cannibalization of their own product and services offerings?  Will they transition from mega projects to micro projects?  How will many of these companies who rely upon an on-premise installed base make the transition to the much lower revenue model that cloud computing represents?

To be fair, most of the high tech leaders already have cloud computing groups, and many of the technologies that underpin cloud computing capabilities comes from these very companies.  Certainly, they face many challenges ahead as the industry further transitions to this computing paradigm.

One can easily see the giants of IT playing with other large non-IT industry leaders which will leverage cloud computing through an on premise model, and provide many custom services for those clients.

Besides, for many years to come there will still be a need for large (non-cloud) IT projects and large, financially stable companies to undertake those, that’s why it’s not the end of the end, or the middle of the end, but the beginning of the end for some companies, as not all will survive the transition.

Not to worry though, traditional IT will still be around for many years to come, even if the days of traditional IT are numbered.