Analyst Commentary
Consumption-based IT Services model is not new anymore. The concept is already in use since few years by telecoms utility organizations to add value to their customers by proposing flexible consumption options. Nowadays, several business & technological trends are driving the demand for consumption-based IT models that offer the same flexibility as well as affordability.
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Flexible consumption-based IT services models offer the organizations a niftier way of accessing new technology on the basis of pay-per-use. However, by altering to a consumption-based service model, organizations are actually saving millions of dollars in IT costs and also facing an ongoing year on year investments. Additionally, transparent interest rates plus pay-per-use cost-effective pricing enables anticipating the future of IT expenditure easier scaling up the demand for business.
Cloud computing and IT-based consumption model
Since the cloud develops as the key driver of the consumption-based model and IT services are considered as a very important product that enables in delivering the businesses with the exact quantity of hardware, software as well as support as per the time and requirement. Furthermore, IT as a service (ITaaS) is yet another new approach to describe the IT consumption model, in the terms of service providers that offer and orchestrate IT services & resources. Moreover, ITaaS offers a list of software as a service (SaaS), infrastructure as a service (IaaS) as well as a platform as a service (PaaS) as possibilities & also businesses are allowed to amalgamate with other as per to their needs.
Report Description
The consumption-based IT Services model is the business approach used by IT services as well as resources for achieving a balance between cost, efficacy and productivity, along with addressing the alliance, administrative tasks and refining business processes & objectives. Furthermore, a consumption-based IT Services model exemplifies the connection between the shifting technology, fluctuating business landscape and rising consumer demands. It is basically the transformation taking place from computing to consumption for companies. This also builds on business transactions coupled with the technological processes.
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From past few decades, the traditional IT models were based over capital expenses for direct purchase of equipment and expense related with the operational and maintenance activities. This particular model necessitates businesses to obtain an asset up front, position it on premise and uphold it over the time. However, this is a risky as well as costly method owing to the rapid developments in technology and rising consumer demands.
On the other hand, new consumption-based IT Services model are acquiring the landscape by letting businesses pay according to their usage. This will probably lead to the lessening or may be removal of capital expenses as well as costs involved for maintenance & up gradation processes. Moreover, will thus seek attraction of several businesses to swift from the traditional IT model to the new IT consumption based model.
Factor Driving the Adoption of the consumption-based IT Services model
This trend is majorly driven by the extensive adoption of mobile devices and the recognition of BYOD practices by several businesses, this will allow the employees and customers to access their documents irrespective of their time & location. For instance, Uber and Lyft, is utilizing this model by structuring it on consumers’ smart devices for driving and scaling up their business model. Some of the vital aspects of such services include security, consistency, scalability and accessibility and the new consumption-based IT Services model is enabled with all these abilities.
Another, example is HP that has emerged as a global leader in the market space by offering consumption-based licenses for hardware & software services. Moreover, consumption-based IT Services marketl is a fascinating option for the CIOs of companies who are making an effort to migrate from the traditional one-size-fits-all technological solutions to consumption-based IT Services market.
Challenges and Opportunity of the consumption-based IT Services market
One of the major challenge that will restrain the growth of the consumption-based IT Services market is shadow IT that arises as soon as any organization loses control over the usage and types of devices used by their employees. Thus, to address this challenge the organizations are required to bring up-to-date and implement policies & practices about the uses of IT.
The consumption-based IT Services market offers several opportunities to the investors by enabling flexibility & proficiency in businesses.
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