An HP Focus on Utility Computing

HP Labs isn’t the only R&D facility in the Silicon Valley. In fact, it isn’t even the biggest one. But it counts a string of innovative breakthroughs to its name.

And despite
recent management changes, and the distraction of numerous acquisitions, the
prototypical Silicon Valley firm, which started in a garage, has kept its
investment in R&D high with some $3.5 billion slated for this year, of which
about 5 percent is used by its labs.

HP Labs in Palo Alto employs 400 people and is one of six labs worldwide with a total of 700 employees.

“We’re very healthy and we innovate to solve real customer problems,” Rich
Friedrich, director of HP’s Internet systems and storage laboratory, told

“Some other labs have gone through a kind of
pendulum of speculative research and then switched to a very short-term
payback focus, but we’ve always been very focused on innovating to solve
real customer problems. We’re not ivory tower, we meet with customers all
the time.”

A project launched at the labs three years ago, Enterprise 2010, tries to
forecast what the demands of tomorrow’s data-center customer will be and how
best to address them.

One big aspect of that is HP’s work in utility
computing — the idea of pay-as-you-go access to computing resources.

Other companies, notably Sun Microsystems , with its grid utility model, are pushing a similar scheme. Sun is essentially saying
“come and get it” with dollar-per-hour-per-CPU pricing, while HP is
working with a few select clients to develop the program.

“We’re very early on with this idea of offering temporary or peak
capacity on a per use or as-needed basis,” Frank Gillet, principal analyst
at Forrester Research, told “There are a handful of
early experimenters, but the software providers aren’t necessarily ready to
do it yet; a lot of work still remains.”

DreamWorks has tapped the
1,000-processor compute farm at HP Labs on two of its movies, “Shrek II” and

HP ProLiant DL360 servers running Linux and HP ProCurve network
switches are linked via a secure, high-speed network to DreamWorks Animation
studios to provide an extension of DreamWorks’ internal data center. This
gives the studio a pooled set of resources that can be accessed as needed
without having to make a major capital investment in hardware.

Analyst Gillet says the DreamWorks case is a good example of where
utility can work today, but not necessarily a model for wider adoption.

“Dreamworks has a good idea what the end point for their projects will
be, so it’s not economical for them buy a lot of equipment for a short term,
or commit to a long term outsourcing deal, they’re saying, “Just help me do
my movie”.”

Friedrich points to Hurricane Katrina as an example of where
utility computing could have been of value to insurance companies that
suddenly had to deal with a huge increase in claims to process.

But that example also raises the challenge of selling the idea. HP admits none of its big insurance company customers have bought
into the utility computing idea yet.

Software has to be adapted to be
accessed remotely, and the insurance companies and other big potential
customers have to warm to the idea with a rock solid sense that the
customer data they’re exposing to a third party such as HP is secure.

Analyst Gillett thinks utility computing will become a much bigger part
of the IT landscape in years to come, but it has a long way to go.

“Most CIOs are more inclined to say ‘Just buy another box’ when new capacity is needed. That’s what they’re used to because it’s a guarantee of capacity
that’s in their direct control.”

In fact, HP has a group of CIO customers it regularly meets with, and
Friedrich says it’s using feedback from them to refine the utility computing

“There isn’t much of a market for [utility computing] now,” said Gartner
analyst Martin Reynolds. “You have to build out the infrastructure where,
for example, software doesn’t care where it’s running. But it’s going to
happen and be very important.”

Corrects number of employees at HP Labs in Palo Alto, CA (400).

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