The Birth of a Utility
How the Internet Is Becoming a Utility and What that Means for Business
By John Chaney
 Describing the Internet in terms used for utilities is nothing new. Data “flows through pipes” and the World Wide Web is an information “grid.” Despite these common descriptors and its exponential growth, the Internet did not start out as a utility, and only now is it evolving into one. This evolution will have a significant impact on communication and computing — in other words, on the way we do business.
Becoming a Utility
A typical utility starts with a new technology that lends itself to central points of creation, processing and delivery — power plants for electricity, treatment plants for water, switching centers for telephony and so on. The means to deliver these commodities or services developed along with the central technologies. Instead of centralized processing of a product or service, the first years of the Internet consisted of network growth. From the first network connections of the 1960s until recently, the Internet has been “more pipe than product,” serving more as a connection grid than a distribution network. To draw an analogy, imagine a situation in which individuals connected their own personal power generators to create a shared power grid. For a number of reasons, this would not be a viable way to distribute power resources. But for sharing bits and bytes, it works fine.
Roughly 10 years ago, the large and growing network of “data pipes” that was the Internet began to transform. The “dot-com” boom and bust of the late 1990s was only a precursor to this transformation, and the burst of that bubble had no real impact on the growth of Internet traffic. Advances in technology enabled this growth, but what really drove it was the fact that the Internet was finally becoming a true utility, taking over much of the role of traditional telecommunications.
Like other utilities, the transforming Internet is now supporting the operation of central “power plants” — plants with names such as Google, Facebook, Amazon and others. Internet traffic is projected to continue doubling every two years, and the driver will be the larger and larger role it will play as a utility, delivering not just communications and consumer applications, but also business software.
Better Software
Software applications for business have traditionally been delivered as discs or downloads loaded onto company servers and workstations. With the Internet becoming an application utility, this model is changing. More and more software can be accessed online with nothing more than a subscription login and a device that has one of the common Web browsers.
Remote access to business software is nothing new. Virtual Private Networks (VPNs) have been in place for years, allowing remote employees to log into their work computers, and applications such as Microsoft Remote Desktop let staff emulate the experience of sitting at their desks and using their computer software. In some cases, companies are moving all or most of their software and computing resources to an outsourced hosting service. There are advantages to this type of so-called virtualization model, but it is important to distinguish it from true Internet-based or “cloud” solutions.
A virtualized solution effectively picks up and moves a company’s computing resources into a “private cloud” managed by a third party. A true cloud solution simply serves up a particular application that can be used anywhere by any Internet-enabled device. This distinction may seem trivial, but understanding it is important when planning for new software purchases or IT services. Here are three reasons to consider Internet-based software for business use:
1. Access
Web-based software provides anywhere, anytime, any-device access to business applications. Unlike VPN connections or virtualized environments, Web-based software will typically place no requirements on the device — computer, tablet, smartphone, etc. — other than the ability to launch a browser. Management can access up-to-date business information anytime, anyplace, and field staff can stay better connected to the office and to each other.
2. Usability
Vendors delivering software for use over the Internet must take into account the environment in which their applications will be running. Complexity does not play well in Web browsers, and user devices cannot be expected to carry out any significant data processing. This means that the user interfaces of Web-based applications must be designed for ease-of-use and intuitive presentation of information. Vendors moving their software to the Internet are redesigning the way the software is used, creating smarter, easier-to-use products.
3. Cost
Web-based software may be purchased by the user or offered on a subscription basis. Regardless, the user enjoys a significant reduction in hardware and IT infrastructure costs. Cost is clearly a primary motivation. Web-based software is “zero-footprint,” meaning that no server and no special user hardware are required. From an IT perspective, there is no software to install, update and maintain. Even if a company chooses to purchase and host Web-based applications in their own private cloud environment, the savings in user hardware and software can be significant.
Better Business
The growing wave of business software over the Internet holds particular promise for the business of construction contracting. Unlike many other industries, construction occurs in remote and varied locations, every project is unique and nearly every new project involves a new collection of project partners and vendors. In addition, project information is constantly changing, it must be shared with many individuals in many locations and there is always a lot of it. These characteristics lend themselves perfectly to the use of Web-based software. Here are a few ways that contractors can take advantage of the inherent benefits:
1. Closing the Gap
A contractor’s ability to manage the profitability of a project is directly related to the accuracy and timeliness of the information at their disposal. Gaps between budgets, projections and actuals are inevitable, but if there is a large gap in the time it takes to figure them out, then the ability to take corrective action is compromised. Giving field managers the ability to record project data from the jobsite as it occurs — and making it easy to do so — helps identify gaps in performance and cash flow as they occur. This helps contractors close the gap between the profit margins they plan for and what they actually achieve.
2. Taking Control
One objection occasionally raised regarding Web-based software is that the user loses control. In reality, vendors who deploy their software over the Internet have more latitude to give the user greater control. Client-server software delivered to a company and installed on their hardware often comes with pre-established rules for licensing and usage. Every time a change in software usage or licensing is needed, it involves a support call (or calls) to the vendor. With Web-based software hosted in a cloud environment, concerns about how software is being deployed and used by different individuals goes away since access is controlled as part of the hosting service. This is resulting in more flexible business software where the user has control over who has access to use or view different applications, information and reports.
3. Building Collaboration
Perhaps the biggest boost to productivity to be realized from Internet-based software is the ability for project partners to work better together. Information is the common thread that runs through every project, and information is not static. Change is the norm, and to coordinate the activities of a diverse group of project participants in the face of constant change is no small task. Web-based applications for project collaboration are emerging, which promise to create a virtual workplace where information is shared, changes are easily identified and partners can work and plan together using the same intuitive applications.
Conclusion
Web-based software is not new. What is new is that the Internet is becoming the default computing and communications platform for business as well as personal use. It is transforming into a true information utility. This transformation will bring positive change to the ease of use and accessibility of business applications and help contractors work better and work better together.
John Chaney is the President and Co-Founder of Seattle-based construction software developer Dexter + Chaney. |
