McNealy predicts the rise of utility services, decline of integrators

McNealy predicts the rise of utility services, decline of integrators

Sun Microsystems CEO and chairman, Scott McNealy, predicts that end user organisations will bypass systems integrators in the future and will instead have their IT needs satisfied by “utility” style service providers.

Speaking at a press event in Sydney, McNealy said that building your own computing environment (such as data centres) was “so last millennium”.

“CIO’s are getting tired of assembling their own computing environment or data centre,” he said.

McNealy sees complexity as the number one problem in the IT industry and predicts that organisations will begin looking to their traditional service providers for their IT needs. He sees service providers – such as telecommunications carriers – as the future of IT services as they have the billing mechanisms, broad customer reach and utility computing model necessary to reduce the complexity of IT for end users.

“In the future, most companies won’t buy computers, they will buy services,” he said. “Right now, when you want to make phone calls you don’t buy a telephone switch, you buy services.”

Flanked by Andrew Johnson, managing director for the online solutions group at key telecommunications customer Telstra, McNealy said the utility computing model would reduce the need for systems integrators.

“In the telephony market, there is no equivalent of EDS or IBM Global Services,” he said. “The telco buys from the manufacturer of the equipment, and provides a service.”

McNealy said Sun Microsystems would be well-positioned for such changes in market dynamics as it sold complete “systems” to customers rather than components of systems. He saw Sun as being the company that would manufacture those highly scalable and reliable systems service providers would use to provide computing power to end users.

Johnson said the telecommunications carrier was one Sun customer that aimed to reduce the complexity of its IT systems – citing its recent commitment to using Sun’s hardware and software platforms for its online environment.

“We have more than 85 different software vendors in our online environment alone,” he said. “While there will never be just one [vendor], we are looking to dramatically reduce the amount of vendors we deal with from an infrastructure point of view.”

Telstra is also currently evaluating StarOffice for its 40,000 desktop users.

McNealy said the carrier was one of 130 sites either testing or using StarOffice in Australia.

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