For most of us, when asked about IOS, the immediate association that comes to mind today is with Cisco's operating software for their routers. The term also stands for Intel Online Services, a Web hosting service founded in 1999 and closed in 2002.
IOS was a fairly large scale operation with over a million square feet of data centers in London, Tokyo, Santa Clara and Chantilly.
Dalibor Vrsalovic, a former IOS president was quoted saying In the course of building IOS, we developed advanced technology that automates and standardizes key Web hosting functions, as well as operational expertise that enabled us to deliver some of the best service levels in the industry. In the technology of the time these functions were very refined and sophisticated, but still defined in terms of physical resources. It's hard to believe this was less than ten years ago.
The challenge with physical resources was that when the downturn from the dot-com crash came, the physical infrastructure could not be turned down fast enough to track the rapidly changing business conditions, and the operation had to be discontinued to stem the flow of red ink.
The assets were physically transferred to SAVVIS Communications to provide and ensure continuity to existing IOS customers.
The year 2007 will be a watershed year where those heroic measures may not be necessary anymore. Using an economic analogy, it would be like doing electronic funds transfer versus having to ship gold coin to complete international transactions.
This capability will be enabled by the increasing adoption of virtualization. Virtualization is not just about increasing load factors in data centers. It may redefine the way IT is done. In the case of IOS, the provided resources could have been aggregated from a number of resource providers, including physical resources. These resources would exist within a large economic ecosystem.
An event like the dot-com crash could be managed by renegotiation of existing contracts instead of the much harder task of disposing of physical assets.
The benefit of this ecosystem is the spreading of risk: the resources would be allocated and serve a large community and different business segments, instead of the relatively small and concentrated customer base that IOS had.
This spreading of risk is a distinguishing characteristic of mature industries such as Insurance and Financial Services. It is only matter of time before the IT industry reaches a similar level.
Even if the IT industry gets redefined by virtualization, the buck has to stop at a divide where virtualized resources become physical. The following paper in Intel Technology Journal documents a few ideas for a physical foundation to support a virtual world.