Grid Technology Partners issues report on Global Grid Computing marketHeidelberg 22 jun 2002 The Grid is providing companies around the world, quantifiable economical benefits today! There is no hype in the real monetary benefits companies are seeing today in their bottom lines.
There is an enormous amount of money invested in IT infrastructure, both in systems and networks. Strangely, however, most of those investments are under utilised. For instance, only 10% of
the computer cycles are used on servers and desktops. Hence, there is tremendous opportunity to capture the latent value of IT investments just by the efficient utilisation of the deployed assets.
That is the promise of Grid computing, and that is why Ahmar Abbas from Grid Technology Partners thinks the Grid is more than a hype: there is a sound and straight forward economical basis for proliferation of Grid Computing. He is the author of the recently released report "The Global Grid Computing Report 2002 - Technology and Market Assessment" that highlights some of the key areas where Grid computing is having a direct and immediate impact on making the IT infrastructure fulfill the promise that has long been expected of it.
Ahmar Abbas sees three main sectors that could benefit immediately from Grid technology. Not surprisingly those sectors today consume a lot of compute resources: In academia and research, Grid computing has been under development and in use for almost 8 years. Grid Technology Partners cover in detail the major grid computing related efforts in the academic and research community. However, it is important to note that 75% of all monies spent on research and development is by companies around the world. The first wave of grid deployment is seen in the R&D departments of companies. This is not surprising since industry will spend US $18 Billion on high powered servers and workstations and another US $2-3 Billion in high performance computing such as CRAY and IBM super computers. To quantify the potential market size, Ahmar Abbas looks at IT budgets as well as R&D budgets. It must be remembered, he says, that 60% of money spent on IT is not from the budgets of the IT department. The EU States, US, and Japan will spend US $1.5 Tillion over the next four years on R&D. The EU will spend US $110 Billion just this year. Expenditure for each major industry section was analysed around two dimensions. First the percentage of the overall national R&D expenditure and second the intensity which is defined as R&D expenditure relative to the sales. In the pharmaceutical sector for instance, the percentage is 12% of the total, and the intensity is 11% of sales. The communications industry spends 4% of the total, but 12% of its sales. Many of the major industries are already familiar with distributed or cluster computing. They have many applications today that are ready to take advantage of grid computing. These industries and there grid ready applications are driving the initial deployments of grids in corporate environments around the world. Traditional IT applications will drive the second wave of grid deployments. Ahmar Abbas calculates that companies can enhance their R&D productivity gain by as much as 47% by using Grid technology. To achieve this, companies will spend about 2-3% of their R&D budgets. The grid computing will have a worldwide market of US$ 4.1 billion by 2005. For the coming years Abbas expects an accumulated yearly growth rate of 276%. On average the cost per CPU for Grid enabling will be between US$ 160 to US $600 depending on the size of the grid deployment. A lot of work, especially in software and application development still remains to be done. Software Vendors have to decide which applications to pick first and who is going to pay for their "grid enablement". IBM Global Services and other major consulting firms will benefit tremendously as corporations around the world "grid-enable" their businesses. How can we tell whether Grid technology is a success? Ahmar Abbas sees several milestones ahead. A first indication of success could be that large companies install really huge Grids of say size 1000 - 2000 CPUs. In the second quarter of next year he also expects to see computers in the human resources or accounting department on the grid, providing their extra CPU, memory or storage capabilities to help the R&D department of companies solve problems - quicker and with more rigor. That will not only indicate the acceptance of the technology but also the conquering of the fairly substantial internal organisational challenges faced during deployment of grid computing. But Ahmar Abbas is confident that the Grid will succeed, the backing of many large players, IBM, SUN, HP and Oracle certainly helps; but, more importantly, the single most compelling factor remains the large gains in corporate productivity. They are just too substantial to ignore. In fact Abbas says, that any CEO, Managing Director, CIO and CFO who doesn't have at least a grid computing pilot running in their company is asleep at the job. The Grid offerings are rather diverse today. Hence, standards' groups such as the Global Grid Forum play an important role. Globus will, undoubtedly be a part of the Grid standards, as probably will be OGSA. During the next few months it will be key to create market awareness and educate companies on the benefits of grid computing. The benefits of the technlogy have to be presented as quantifiable numbers that can be easily understood by the Finance directors of companies. Grid Technology Partners was launched in 2002. The firm focuses on three areas: 1) Market and Technology Research 2) Custom Consulting services 3) Grid Computing Roundtable - a thought leadership forum designed to stimulate innovative thinking in applicability of grid computing technology to topical events. One such topic that will be covered this year is the role that Grid Computing can play in integration of the accession states into the EU. The main market research product is "The Global Grid Computing Report 2002 - Technology and Market Assessment". The report has ten chapters:
The report is available from Grid Technology Partners.
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