Chapter 4
OBJECTIVES
• Define IT infrastructure and describe the components
and levels of IT infrastructure
• Identify and describe the stages of IT infrastructure
evolution
• Identify and describe the technology drivers of IT
infrastructure evolution
OBJECTIVES
(Continued)
• Assess contemporary computer hardware platform
trends
• Assess contemporary software platform trends
• Evaluate the challenges of managing IT infrastructure
and management solutions
Hong Kong’s New World Telecommunications Case
• Challenge: fragmented, high-cost IT
•
•
•
infrastructure slowed down market and
customer response times
Solutions: integrated storage area network to
enable the flow of information among
different types and brands of computer
servers
Reduce number of servers from 107 to 70
Illustrates the importance of IT infrastructure
for achieving business objectives
IT INFRASTRUCTURE
Defining IT Infrastructure
• Includes hardware, software, and services
• A set of physical devices and software applications that are
required to operate the entire enterprise
• Your firm is largely dependent on its infrastructure for
delivering services to customers, employees, and suppliers.
• You can think of infrastructure as digital plumbing, but its
much more than that!
IT INFRASTRUCTURE
The Connection between the Firm, IT Infrastructure, and
Business Capabilities
Figure 6-1
IT INFRASTRUCTURE
Levels of IT Infrastructure
Three major levels of infrastructure:
• Public
• Enterprise
• Business unit
IT INFRASTRUCTURE
Levels of IT Infrastructure
Figure 6-2
IT INFRASTRUCTURE
Evolution of IT Infrastructure: 1950–2005
• Electronic accounting machine era: (1930–1950)
• General-purpose mainframe and minicomputer era:
(1959 to present)
• Personal computer era: (1981 to present)
• Client/server era: (1983 to present)
• Enterprise internet computing era: (1992 to present)
IT INFRASTRUCTURE
Eras in IT Infrastructure Evolution
Figure 6-3
IT INFRASTRUCTURE
A Multitiered Client/Server Network (N-tier)
Figure 6-4
IT INFRASTRUCTURE
Technology Drivers of Infrastructure Evolution
• Moore’s law and microprocessing power
• The law of mass digital storage
• Metcalfe’s law and network economics
• Declining communications costs and the Internet
• Standards and network effects
IT INFRASTRUCTURE
Moore’s Law and Microprocessor Performance
Figure 6-5
Falling
Cost of Chips
IT INFRASTRUCTURE
Figure 6-6
IT INFRASTRUCTURE
The Capacity of Hard Disk Drives Grows Exponentially, 1980–
2004
Source: Authors.
Figure 6-8
IT INFRASTRUCTURE
The Cost of Storing Data Declines Exponentially,1950–2004
Source: “Exponential Growth an Illusion?:
Response to Ilkka Tuomi,” by Ray Kurzweil,
KurzweilAl.net, September 23, 2003. Used with
permission.
Figure 6-9
IT INFRASTRUCTURE
Exponential Declines in Internet Communications Costs
Source: Authors.
Figure 6-10
INFRASTRUCTURE
COMPONENTS
Seven Key Infrastructure Components
• Computer Hardware Platforms
• Operating System Platforms
• Enterprise Software Applications
• Data Management and Storage
INFRASTRUCTURE
COMPONENTS
Seven Key Infrastructure Components (Continued)
• Networking/Telecommunications Platforms
• Internet Platforms
• Consulting and System Integration Services
INFRASTRUCTURE
COMPONENTS
Computer Hardware Platforms
• $110 billion annually spent in the United States
• Dominance of Intel, AMD, and IBM 32-bit processor
chips at the client level
• Server market increasingly dominated by inexpensive
generic processors from the same manufacturers
INFRASTRUCTURE
COMPONENTS
Computer Hardware Platforms (Continued)
• Strong server market growth for 64 bit generic
processors from AMD, Intel and IBM
• Blade servers replace box servers
• Mainframes continue as a presence working as very
large servers
INFRASTRUCTURE COMPONENTS
Operating System Platforms
• $100 billion annually spent in the United States
• Continued dominance of Microsoft OS in the client
(95%) and handheld market (45%)
• Growing dominance of Linux (UNIX) in the corporate
server market (85%)
• Windows 2002 and 2003 Server remains strong in
smaller enterprises and workgroup networks
INFRASTRUCTURE COMPONENTS
Enterprise Software Applications
• $165 billion annually spent in the United States for
basic enterprise software infrastructure
• SAP, Oracle, PeopleSoft (now Oracle), and Siebel
dominate this market.
• Middleware firms like BEA and JD Edwards serve
smaller firms, and work also in the Web services space.
INFRASTRUCTURE COMPONENTS
Data Management and Storage
• $70 billion annually spent in the United States.
• Oracle and IBM continue to dominate the database
software market.
• Microsoft (SQL Server) and Sybase tend to serve
smaller firms.
• Open source Linux MySQL now supported by HP and
most consulting firms as an inexpensive, powerful
database used mostly in small to mid-size firms.
INFRASTRUCTURE COMPONENTS
Networking/Telecommunications Platforms
• $150 billion annually spent on networking and
telecommunications hardware
• $700 billion annually spent on telecommunications
services, e.g. phone and Internet connectivity
• Local area networking still dominated by
Microsoft Server (about 75%) but strong growth
of Linux challenges this dominance
INFRASTRUCTURE COMPONENTS
Internet Platforms
• $32 billion annually spent on Internet infrastructure in
the United States
• Internet hardware server market concentrated in Dell,
HP, and IBM
• Prices falling rapidly by up to 50% in a single year for
low-power servers
INFRASTRUCTURE COMPONENTS
Internet Platforms (Continued)
• Open-source Apache remains the dominant Web server
software, followed by Microsoft’s IIS server.
• Sun’s Java grows as the most widely used tool for
interactive Web applications.
• Microsoft and Sun settle a long-standing law suit and
agree to support a common Java.
INFRASTRUCTURE COMPONENTS
Consulting and System Integration Services
• Most firms today, even large firms, cannot develop
their systems without significant outside help.
• $130 billion annually spent on computer system design,
and related business services like business process
redesign in the United States
• About 85% of business consulting in the United States
involves IT business consulting.
CONTEMPORARY HARDWARE PLATFORM TRENDS
The Integration of Computing and Telecommunications
Platforms
• Increasingly computing takes place over the network.
• Client level: integration of cell phones and PDAs
(Example: Palm Treo)
• Television, video, and radio move toward digital
production.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
The four major themes in contemporary software platform
evolution:
• Linux and open-source software
• Java
• Web services and service-oriented architecture
• Software outsourcing
CONTEMPORARY SOFTWARE PLATFORM TRENDS
The Rise of Linux and Open-Source Software
• Open-source software is free and can be modified by
users.
• Developed and maintained by a worldwide network of
programmers and designers under the management of
user communities
CONTEMPORARY SOFTWARE PLATFORM
TRENDS
The Rise of Linux and Open-Source Software
(Continued)
• Linux is the most widely used open-source software
program. Linux is an operating system derived from
Unix.
• Mozilla Firefox browser and Thunderbird mail clients are
the most widely used open-source applications. Others
include MySQL.
• IBM, HP, Intel, Dell, and Sun have adopted and support
Linux. Linux is a major alternative to Windows server
and even client operating systems.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Java Is Everywhere
Java:
• An operating system—Independent, processorindependent, object-oriented programming language
• Applications written in Java can run on any hardware
for which a Java virtual machine has been defined.
• Java is embedded in PDAs, cell phones, and browsers.
• Java is a leading interactive programming environment
for the Web.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Software for Enterprise Integration:
• One of the most important software trends of the last
decade is the growth of “enterprise in a box” or the
purchase of enterprise-wide software systems by firms.
• Rather than build all their own software on a custom
basis, large firms increasingly purchase enterprise
applications prewritten by specialized software firms
like SAP, Oracle, PeopleSoft, and others.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Enterprise Application Integration (EAI) Software Versus
Traditional Integration
EAI software (a) creates a common platform through which all applications can freely communicate with each other. EAI requires much less
programming than traditional point-to-point integration (b).
Figure 6-13
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Web Services and Service-Oriented Architecture
Web Services:
• An alternative to enterprise systems is to use new Webbased standards to create a communication platform
allowing older applications to communicate with newer
applications.
• Web services refers to a set of loosely coupled software
components that exchange information with each other
using Web communication standards and languages.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Service-Oriented Architecture
• SOA refers to the use of Web services in a firm to
achieve integration among disparate applications and
platforms.
• A firm might have applications (payroll) running on
older AS400 IBM machines, IBM mainframes
(customer data and inventory) and newer applications
running on client/server networks.
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Software Outsourcing
• Today large and small firms purchase most of their
software from outside vendors.
Three kinds of outsourcing:
• Purchase of software packages
• Using application service providers
• Custom outsourcing
CONTEMPORARY SOFTWARE PLATFORM TRENDS
Purchase of Software Packages and Enterprise Software
Enterprise software packages: prewritten off-the-shelf
software
Application Service Providers:
• A business that delivers and manages applications and
computer services from remote computer centers to
multiple users using the Internet or a private network
MANAGEMENT OPPORTUNITIES, CHALLENGES, AND
SOLUTIONS
Competitive Forces Model for IT Infrastructure
Thank you