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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: hlpinout who wrote (95668)	3/4/2002 6:33:32 PM
From: hlpinout	Read Replies (1) \| Respond to of 97611

From Information Week. -- IT As A Utility: When CPUs Are Measured Like Kilowatts March 4, 2002 By Eric Chabrow and Larry Greenemeier Compaq, EDS, Hewlett-Packard, IBM, and other technology companies are promoting the utility-based model as a way of making outsourcing itself more appealing to businesses. While each vendor has a different name for its version of utility-based services, all of the options entail charging customers only for the products or services they use in a given time period. Compaq and HP follow more of an on-demand model--customers pay more or less for server capacity and storage depending on usage. IBM and EDS offer server capacity, storage space, applications, and Web hosting via outsourcing contracts in which the customer doesn't have to lease or buy equipment. Regardless of the delivery model, it's crucial for customers and vendors to work out a clear and mutually agreeable method for measuring usage and charging for that usage. One way of doing that: Terraspring Inc. sells infrastructure-automation software that lets companies pool dispersed servers and storage devices into centrally controlled resources. The software provides a way to charge departments and divisions for the IT resources they use. Terraspring is pitching the application to IT outsourcers for use in their utility-pricing plans to account for different customers' use of shared servers and storage machines. Terraspring engineers came up with a service-measuring unit, the IT equivalent of a kilowatt hour. Outsourcers would determine, on their own or by contract with customers, how many service units to charge for using a server for an hour or for storing a certain amount of data. Terraspring software keeps track of the units, which can be plugged into a billing system. Customers can use third-party service-level-agreement software to audit usage.