Utility Computing Definition

Utility computing refers to the ability of companies to access computing services, business processes, and applications from a utility-like service over a network. The idea being that if a company has to pay only for what it is using then it will be able to save money. While the company offering utility computing services can benefit from economies of scale by using the same infrastructure to service multiple clients. The alternative is to buy hardware that can handle peak loads, but is often using something along the lines of 15% of available resources. Utility computing is the evolutionary step up from Application Service Providers. The underlying technology for utility computing is grid computing -- the network of connected storage and CPUs from multiple systems into a centrally managed, but flexible computing environment.