Pre commercial internet days
•Cos used proprietary technology to build networks
•It was expensive
•Led to duplication in infrastructure investment
•Multiple technologies led to confusion, poor
performance and reliability
•Interoperability was a problem
•To overcome incompatibility issues cos built s/w that
worked as a bridge
•Cos got locked in to specific vendors and lost
bargaining power
Adv. Of public internet
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Cos share a communication infrastructure
Can use common interfaces like a browser
Common std tcp/ip so components interoperate very well
Components are cheaper because of standardization
Cos don’t get locked into a vendor so can bargain for
better price and service
• As communication technologies become more
standardized and modular, outsourcing becomes available
at a smaller level (why?)
– But this will make IT managers job more challenging as integration
will become important
– Although with smaller steps risks are reduced
– Advantage would be better price and service as each marginal
service provider will be good at what he does
– Managing relationships with these providers will become important
• Outsource if service offered is cheap, reliable, and
provides no competitive advantage
• In the earlier days outsourcing meant all or nothing
• Many cos that had legacy systems and wanted to move to
newer systems outsourced their legacy systems for cash
which was used to slowly build client-server systems
• These days can go for incremental outsourcing
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Lower risk associated
Lower financial stakes
Lower impact of mismanagement
Integration can be a challenge and problematic
Outsourcing hosting of a cos systems: hosting
could mean physical location, power, h/w, sw, mgmt
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Where to locate physically
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Which management functions to outsource
Benefits of outsourcing hosting are:
1. Reduced downtime by 87% for web server hosting
2. Lower cost
3. Can focus on more important things
4. Higher ROI
Hosting models
1.
Colocation hosting: no frills access to facility & infrastruc
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2.
Rent space, connectivity, and power. Have floor to ceiling cages,
customer owns and is responsible for servers and equipment.
Shared hosting: servers owned and operated by provider
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3.
Customers purchase space on servers
Multiple customers may share a physical resource
Suited for non-mission-critical hosting.
Dedicated hosting: servers owned and operated by provi.
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a.
b.
c.
Dedicated servers---no sharing
Other infrastructure components like routers may be shared
Providers offer complete managed services package
Simple dedicated hosting: deliver a narrow menu of highly
standardized functions such as web hosting
Complex dedicated hosting: wider range of functions
Custom dedicated hosting: support custom functionality. Providers
have to use system integrators and other service providers.
Managing relationships with service providers
Its important because it effects your performance. So choose
reliable providers and manage strong relationships.
How to select service providers?
1. Write a RFP and send it to seemingly qualified vendors. This
asks for info relevant to their service capabilities including
financial, technical, and operational information.
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2.
3.
4.
Ask for service guarantees, check what their averages are like
Get info from industry analysts
Other companies
Visits to the provider’s site