Sunday, May 2, 2010

A Quick Review of "The Big Switch"

Quick review of the Book

The Big Switch

Big Switch

by Nicholas Carr (Author)

Book Description

An eye-opening look at the new computer revolution and the coming transformation of our economy, society, and culture..

From Amazon:

A hundred years ago, companies stopped producing their own power with steam engines and generators and plugged into the newly built electric grid. The cheap power pumped out by electric utilities not only changed how businesses operated but also brought the modern world into existence. Today a similar revolution is under way. Companies are dismantling their private computer systems and tapping into rich services delivered over the Internet. This time it's computing that's turning into a utility. The shift is already remaking the computer industry, bringing new competitors like Google to the fore and threatening traditional stalwarts like Microsoft and Dell. But the effects will reach much further. Cheap computing will ultimately change society as profoundly as cheap electricity did. In this lucid and compelling book, Nicholas Carr weaves together history, economics, and technology to explain why computing is changing—and what it means for all of us.

I read this book in January of 2009 and then wrote this review... After reading the book, the summation above captures the core of his message. The first part of the book drags you through the beginnings of the electric power generation industry and how it grew. The author then uses this as an analogy to support his view that "utility computing" will replace corporate datacenters we have today.

  • Using alternating current (AC versus DC of the time) enabled power companies to distribute their power generation capabilities over long distances, gather more customers and thus gain greater economies of scale. This is similar to what high speed networks and the internet have done and continue to do for computing.

  • When power companies could have a mix of customers that smoothed demand over a 24 hour period they were able to fully leverage their investment and thus lower the cost of power for everyone. This was dramatic and we are seeing the same effect on the internet. Google and are leveraging their software as a service (SaaS) but also hardware as a service (HaaS) companies like Amazon and S3 allow clients to host their applications and consume enterprise grade services for millions to use.

  • Much the same way that electricity (the electrification of America) created more jobs and allowed companies to scale, computing does this today for companies. HaaS and SaaS allow massive scale at a fraction of the cost for new companies that use it.

The topic of hardware as a service (HaaS) was one that I hadn't really seen that much information about. I am familiar with Amazon I did not realize the collective power that this gives small companies. Sitting in between these are application platform as a service, like Googles "Appengine". Some of the new SaaS companies use HaaS provided by another company. The number of employees for the SaaS company is sub-twenty but revenues per employee can reach into the millions (all with very little overhead).

The author touched on some of the social and business impacts he sees and the impact that it has had on anyone that creates content that can be digitized. The rest of the book covered various observations about the impact of the Internet on society and business that can be found in just about any other Web 2.0 book out there.

I don't recommend paying to read this (borrow mine if you must). The author's basic message was covered in the first chapter and if you have read any other web 2.0 resource you are familiar with the various observations about our new Internet culture.

Although Nicholas Carr’s book compares the birth of commercial power generation to cloud computing, it’s a little more complicated than that. Although the concept is similar their is no standard cloud computing unit of measure like there is for power generation. The variability is just too great.

- Chris Claborne

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