Commentary

Editor’s Note: The Continuing IT Revolution

By Leslie D. Helm October 7, 2011

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This article originally appeared in the November 2011 issue of Seattle Magazine.

When a neighbor recently installed an irritating security system that beeps loudly every time a car passes, I went in search of a decibel meter to see if my neighbor was violating any noise ordinances. Amazon had one for $89.99. Instead, I turned to my iPhone and found a perfectly serviceable decibel-meter app for 99 cents.

The iPhone has increasingly become my go-to toolbox for solving daily problems. It now serves as my digital recorder, my watch, my alarm clock, my radio, my stereo, my calendar, my navigator and, increasingly, my laptop.

Much of what the iPhone does for the individual, cloud computing promises for the enterprise. Software that once had to be purchased, installed and maintained on a corporate server can often be rented now more cheaply over cloud-based services.

But is all this progress a net positive for the economy as a whole? The upside for companies like Apple and Amazon is clear. Their share values are soaring. Apple is now worth about $400 billion, 70 percent more than Microsoft. Amazon, a leader in cloud computing, is worth more than $100 billion. And corporate America, able to produce more products and services with fewer people thanks in large part to advances in information technology, now sits on a $2 trillion mountain of cash.

But what of all the unemployment that this approach creates? What happens to the industriesfrom retailing to manufacturing to software developmentthat are being sharply undercut? The truth is that while technological change has always had a disruptive impact on society in the short term, in the long term it tends to generate new wealth.

Already, startups are being established in ever greater numbers by ever younger entrepreneurs who use the low-cost tools available on the web to create new businesses with little capital (see page 28.)

The biggest challenge is to the companies that now face a vastly changed competitive landscape. You have to give credit on this score to Microsoft for recognizing the demands before it and investing $10 billion in research and development this year to make virtually its entire product line available on the cloud.

Other firms, too, have to start investing more aggressively to make sure they are not left behind. While cloud computing may enable some companies to reduce the number of people in their IT departments doing routine maintenance, strategically, the role of internal IT managers is more important than ever (see page 38). Businesses must take the time to identify their needs and be ready to spend the money required, whether in internal development or cloud-based services, to position themselves for a future that is as promising as it is uncertain. Theres money to be made. Ladies and gentlemen, start your engines.

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