Big Blue Orchestrates New On-Demand Menu

If enterprise networks are truly moving toward an on-demand world
computing capacity is ordered from providers “by the drink,” then IBM
launched a fancy new pitcher of IT services to be served up remotely.

Officials at the Armonk, N.Y.-based company call the new range of
outsourcing services “flexible support,” which it says includes
and computing systems that automate, manage and support data center
functions — either virtually or in
the customer’s own data center.

In this case, IBM is calling the new IT service a hybrid IT
model — in which IBM remotely manages, automates and supports a
multi-platform data center.

The services organize parts of IBM’s automation and virtualization
technology that it acquired through its purchase of
Think Dynamics. The Toronto-based company’s software measures and
computing demand and can help reallocate resources in response.

But it also could include support for smaller projects to help
with legacy-saddled networks to start deploying service oriented
architectures (courtesy of IBM) as part of a coming era of Web Services

Dev Mukherjee, IBM’s vice president for e-business on-demand
told the hybrid IT outsourcing services are
IBM’s corporate strategy of enabling customers to outsource their data
center operations to IBM while still retaining ownership of their IT
and employees.

The flexible support services, Mukherjee added, are aimed at
customers improve utilization and cost management of their data

“Many customers have multiple silos of equipment within their data
center, often with less than 20 percent peak utilization” across some
systems, Mukherjee said. By implementing a server management system,
remotely if need be, “customers can bring their data silos together”
utilize more of the resources that often go unused in enterprise

Call it a mix of grid computing services, automation, virtualization, and self-healing diagnostics, delivered from an architecture built on open standards — designed to harness a network’s CPUs in order to wring more returns from a network’s sunk IT costs. In the process, IBM is trying to help business
customers’ IT costs become more variable instead of the usual fixed
item on
a company’s balance sheet.

The services are also based on IBM’s Universal Management Infrastructure (UMI).

UMI is based on open architecture standards that gird the process of
knitting together disparate back-end systems such as different servers
and storage devices, which helps to void the need for developers to write
applications for each separate system. UMI is also one part of a $10
commitment that IBM’s Chief Executive, Sam Palmisano, has said the
would invest within a decade as part of its commitment to offering
and services on-demand, which includes major support for Linux and
development of autonomic, self-healing systems.

New flexible support offerings include
infrastructure management assessment services, Tivoli Intelligent
Orchestrator software, and Web Server Orchestration, an automated blade
server-based Web and application system.

Mukherjee said the service features “sense-and-respond” server and
storage provisioning which increases or decreases computing capacity in
real time, as demand changes.

The new services are the latest from IBM’s expanding range of
services from its global services division, which accounts for about
half of
the systems vendors’ annual revenues.

The latest services strategy announcement also comes as IBM basks
in and
Wall Street analysts coo over IBM’s fourth quarter results
that showed total contract signings were $17.3 billion during the quarter, in which the services division signed 18 deals with value greater than $100 million, and three of which were greater than $1 billion.

One potential new customer of the remote outsourcing services could be JP Morgan Chase , which awarded
IBM a landmark $5 billion outsourcing contact in late 2002 that
included new on-demand services.

For example, the JP Morgan Chase deal called on IBM’s global
services division to help the banking conglomerate create a “virtual pool” of
computing resources that will be accessed and deployed as needed — or
on-demand. The bank recently agreed to merge with BankOne in a $58 billion deal that would create the second-largest U.S. bank behind Citigroup — and present an opportunity for systems integration as the two banks align their IT networks.

At the time the outsourcing deal was announced, one analyst dubbed it a “poster child” for how on-demand would be received among enterprise customers with major IT
investments. But analysts also questioned whether IBM would, in effect,
be stuck shouldering its customers’ IT costs over time.

IBM said pricing is determined by the number of processors and the
capacity a customer deploys.

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