Sun to auction time on its online grid

Sun Microsystems Inc. has pushed its grand vision a step further by announcing it will auction off time on its online computing power grid.

This stepping up of its on-demand computing plans comes just a day after it announced its US$1-per-day grid computing scheme. Under that system, customers can buy additional computing power as and when they need it, rather than buying hardware to do it themselves.

The usual analogy is with how electricity is sold.

Sun plans to have the online auction up and running within five months maximum, maybe two or three.

The struggling Santa Clara company has been quietly selling server hardware through auction sites such as eBay for some time — at least four years — and it has reportedly been reasonably successful. One report suggests that most of the buyers are new customers new to Sun, so the organization is expanding its base. This latest wheeze however marks a change in business model. Sun has got together with online stock market company Archipelago Holdings Inc. Sun’s VP of finance and strategy Robert Youngjohns said that the online exchange would benefit companies “with large and fluctuating demand for computing capacity”.

Analysts are mainly cool on the idea, adopting a wait-and-see approach. In other words, neither they nor I have the faintest clue as to whether or not the scheme can work, nor whether it’s going to be good for Sun. However, one commentator has calculated that Sun will have to sell a vast number of computing hours — billions — to cover the investment required to make the scheme work.

However, Sun’s hyperbole about the recently launched $1-a-day scheme now rings slightly hollow. Sun calls the scheme “the democratization of network computing”. The official blurb continues: “What Apple, IBM and Compaq did to advance the PC revolution, Sun is now doing in network computing — enfranchising large numbers of new business customers.”

You’d have to question, if computing power is being auctioned, just to what extent that remains true — unless of course Sun has access to unlimited computing resources. Nonetheless, Sun deserves credit for putting its money where its mouth is. Which is more than you can say of other large vendors such as Hewlett-Packard Co. and IBM Corp.

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