Software // Enterprise Applications
Commentary
6/24/2005
06:30 PM
Stephanie Stahl
Stephanie Stahl
Commentary
Connect Directly
RSS
E-Mail
50%
50%

Editor's Note: Beware A Hidden Cost In Buying IT

Let's say it's time to purchase a new technology asset--a new enterprise software application, new infrastructure systems, whatever the case. A ton of time and energy likely go into determining the ROI (in the next three, six, nine months and beyond), the vendor analysis (financial stability, customer-service rankings, service-level agreements), the price (up front, maintenance, licensing arrangements), and everything else that goes into the purchase process.

But Scott McNealy, who posits that all technology has the shelf life of a banana, recently posed this question: "What are the barriers to exit?" In other words, what will it cost to move from that technology to the next, whether it's an upgrade or a new system? He argues that the exit-strategy costs often dwarf the barriers to entry and the ongoing operational costs. It's one of the things that gives Sun bragging rights when it comes to its history of open standards-based computing, a strategy that has made it less costly for customers to shift technologies.

Sun is making new moves in open computing with an aggressive open-source strategy. Our story this week analyzes whether it can move into a leadership position (see story, "Sun Opens Up"). Also worth noting is a broader open strategy Sun calls the "Participation Age," which McNealy says is based on the belief that people add value by working and sharing in large communities. Think telemedicine, distance learning, and blogging. It's a way to form a bridge from the haves to the have-nots in the digital economy. In some ways, he argues, it's counter to the iPod phenomenon, in which individuals carry their own content libraries around with them instead of storing content in a shared space (but let's not forget that a lot of music sharing goes on these days!). The Participation Age reminds me of some brilliant thinking by University of Michigan professor C.K. Prahalad on the co-creation of value among firms and their customers. You can read more about that in Optimize (see story, Co-creating Value With Your Customers).

Want to hear more from Scott McNealy? Check out The News Show for interviews and much more (June 22 edition) and (June 20 edition).

Stephanie Stahl
Editor-in-chief
sstahl@cmp.com


To discuss this column with other readers, please visit Stephanie Stahl's forum on the Listening Post.

To find out more about Stephanie Stahl, please visit her page on the Listening Post.

Comment  | 
Print  | 
More Insights
Building A Mobile Business Mindset
Building A Mobile Business Mindset
Among 688 respondents, 46% have deployed mobile apps, with an additional 24% planning to in the next year. Soon all apps will look like mobile apps – and it's past time for those with no plans to get cracking.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest September 24, 2014
Start improving branch office support by tapping public and private cloud resources to boost performance, increase worker productivity, and cut costs.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.