In tough economic times, politicians and economists often talk about the importance of new technology. They’ll say that innovation is key to pulling a country out of a downward economic spiral. However, analysts rarely look at the opposite relationship: how an economy can limit innovation. Recently, server tech has reacted somewhat surprisingly to the faltering economy, mainly in the progression and acceptance of the cloud.
Cloud computing has received a tremendous amount of attention in the last several years, and if you ask any IT expert in the world, they’ll probably agree that more and more companies will be moving to the cloud in the next decade. What many analysts miss is that this takes a lot of money; if a company decides to rely on virtualization for all of its server needs, they’ll have to spend thousands or even millions of dollars to convert their IT infrastructure. When a company is struggling, that type of investment is risky.
A more conservative approach means less of a risk while businesses struggle to compete. However, as there’s less call for new server technology, server companies will spend less money on innovation while they wait for market demand to return to normal.
It doesn’t help some providers have had trouble explaining the benefits of a move to the cloud. Company budgets don’t react well to vague descriptions of improved traffic capabilities, and for every company like Amazon with solid virtualization offerings there are dozens of smaller companies that can’t get the point of virtual servers across to their clients.
There are also quite a few companies who simply don’t need virtual servers-in a poor economy, they handle less clients and put less of an emphasis on growth. Servers that grow and shrink to meet a business’s demands can seem like an attractive option during good economic times, but they’re significantly less beneficial right now.
Server technology is limited as a whole when there’s not enough money for liberal IT investments. Ultimately, cloud computing is almost certainly the wave of the future, and I’d agree with the idea that in ten years, the majority of businesses will use virtual servers in some form or another. However, larger businesses aren’t going to make the switch for a few years until there’s enough cash flowing in to justify the proposition.
Do you think that cloud computing technology is limited by the current state of the economy? Post your thoughts in our comments section below.