Sunday, August 10, 2008

Opex Only IT

With cloud, SaaS catching up, IT's capex is bound to shrink. With the utility metered model, and with enterprises buying data center services rather than data center, IT expenditure will move to very high Opex and a very low with not nil Capex.
This is what would get CFOs interested into this phenomenon. It will make it easy for businesses to be more flexible and agile. It would be easy to predict expenses and pay higher when you need more (say quarter ends and holiday sale etc.) and not pay for excess capacity when you don't need it. The cloud provider will be able to even out usage spurts across customers and give that advantage.
The only enterprises which will be having high capex will be cloud providers who will finally be the only one buying infrastructure to build and maintain capacities.

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