Ok. Check out this article on Forbes talking about 3tera, ENKI, and Layered Technologies. All centered around 3tera's Applogic. This is worth a read.

Tiny Firms Offer Big Computing Services - Forbes.com

That is a very interesting article. I think that the idea of people paying IT bills like they pay their utility bills is not a very good option. Considering it would put a lot of people out of work, and costs would skyrocket out of control just as utilities have done. I cannot see where this would even be an option as there are many small companies that would not be able to maintain themselves in this capacity. But it is a very interesting article.

I'm not quite sure how costs would go "up" from a utility computing model.

A Utility Model means you only pay for what you use. In the IT Hosting industry we all know, that most servers are only utilizing about 5-10% of their resources, yet we still pay for the entire server... Why?

This is the problem that utility computing model solves.

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As a partner in a cloud computing company, I often see the IT staff of potential customers reacting as though they have this thought in their heads, just like Attagirl suggested. In fact, often I simply approach the C-level executives on sales calls because their IT staff won't return my calls - so I know they're thinking we're a threat to them.

However, I'm not sure that Cloud Computing is bad for IT employment, and I'll give my reasons below.

My company, ENKI, offers IT outsourced operations services along with Cloud Computing for a total package that can eliminate the need for my customers to hire some staff, especially people who they'd hire for expertise that was only occasionally used. But, the work still needs to get done by someone, and I am hiring those people in order to deliver their services to my customers. To say that outsourcing services reduces IT employment somehow assumes that the outsourcing eliminates the work, which it does not. It may shift it around, though. I'm also not offshoring the work since I need a tightly knit team to offer the best services I can.

Saying that Cloud Computing is bad for IT employment also somehow assumes that one can wish Cloud Computing away or if you are a manager at a Cloud customer company, that you can simply decide not to use it. My experience working at big companies is that when a less expensive way to do something comes along, you *must* take advantage of it, or your competition will do it and you'll have to lay people off anyway as you lose business. So I don't think not using the latest technology, including Cloud Computing, is a choice business can make. It's like deciding you won't buy a dishwasher, washing machine, or vacuum cleaner because you'd rather give jobs to household employees.

As an IT employee, Cloud Computing offers some advantages as well that I can recognize after being a technology manager for many years. Every change creates opportunity as well as potential loss. As an employee, every time there's a change, you can say "I will only do things the old way" or you can embrace the change. My advice is to learn all you can about Cloud Computing, and be the one in your company that drives its acceptance. Then you'll be the indispensable employee rather than the disposable stick-in-the-mud that resists the inevitable. There is a tremendous benefit possible for IT staff in companies using Cloud Computing to move up to more rewarding jobs than those that have been automated away by the Cloud vendors, but they have to have the imagination to see what changes they need to make to take advantage of those opportunities. Most employers who appreciate the contribution of their good employees will be supportive of their efforts to make those changes so that they can keep them in the company. Hiring is a difficult, painful, and distracting job and most managers would prefer to have their good employees move to a new position rather than leave.

What I see among my customers, who are mostly fast-growing companies, is that they're hiring people to complement the Cloud Computing services we offer. The fact that we offer them computing at a tiny fraction of the price of colocation or self-hosting means that they can hire more people to do the jobs they really need in order to succeed, such as DBAs, programmers, system administrators, etc. Their stream of capital is used in a way that is more beneficial to them, but it is still spent on employment. By assisting their growth, Cloud Computing actually stimulates their hiring.