Economic and Business Dimensions Cloud Computing and Electricity: Beyond the Utility Model

TL;DR

Cloud computing shares some utility-model economies, but the analogy misses technical and business-model challenges. The paper assesses the model’s strengths and limits, concluding that cloud computing cannot achieve electricity-like plug-and-play simplicity while innovation continues rapidly.

• Problem

  The utility model offers some insight into cloud computing, but relying on the analogy alone leaves its real technical and business-model challenges and opportunities unaddressed.

  Source: p. 1

• Method

  The paper assesses the strengths, weaknesses, and applicability of the utility model by examining cloud computing’s technical and business-model differences from electricity.

  Source: p. 1

• Results

  Cloud computing cannot achieve electricity-like plug-and-play simplicity while innovation in cloud computing and its applications and business models continues rapidly.

  Source: p. 3

• Takeaways & Limitations

  The paper argues that cloud computing’s real strength is catalyzing innovation, with opportunities for combinatorial innovation growing as it becomes cheaper and more ubiquitous.

  Source: p. 3

  The integration between Apple’s ERP system and its billing engine handling some 10 million sales per day would have been difficult, if not impossible, in the cloud.

  Source: p. 3