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Chapter 5-7

COMMERCE 2KA3 Chapter Notes - Chapter 5-7: Web 2.0, Telnet, Cloud Computing

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IT Infrastructure
Information technology (IT) infrastructure: the shared technology resources that
provide the platform for the firm’s specific info systems applications
Includes: hardware, software, services (consulting, education, training)
Provides foundation for serving customers, working with vendors, managing
internal firm business processes
Defining IT Infrastructure
IT infrastructure is set of firm-wide services with both human and technical
Services include:
oComputing platforms to provide computing services that connect
employees, customers, suppliers (ex. main-frames, desktop, laptop, mobile
devices, etc.)
oTelecommunications services that provide data, voice, video connectivity
to employees, customers, suppliers
oData management services that store, manage, and analyze corporate data
oApplication software for ERP, CRM, supply chain management,
knowledge management systems
oPhysical facilities management services that develop and manage physical
oIT management services, education services, R&D services, etc.
Evolution of IT Infrastructure
1. General-Purpose Mainframe and Minicomputer Era (1959 to Present):
oIBM 360 was first computer with powerful operating system
oCould provide time sharing, multi-tasking, virtual memory
oPeriod of highly centralized computing under control of professional
programmers and systems operators
oMost elements of infrastructure provided by single vendor
oMinicomputers: offered powerful machines at lower prices than IBM
oCould be customized to needs of individual departments/business units
2. Personal Computer Era (1981 to Present):
oFirst IBM PC to be widely adopted by American businesses
oWintel PC computer (Windows operating system) became standard
desktop PC
oBegan to develop PC software tools: word processors, spreadsheets,
electronic presentation software, small data management programs
3. Client/Server Era (1983 to Present):

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oDesktop or laptop computers (clients) are networked to powerful server
computers that provide client computer with services/capabilities
oClient is user point of entry
oServer processes and stores shared data, serves web pages, manages
network activities
oAllow businesses to distribute computing work across series of smaller,
inexpensive machines that cost less than mainframe
oTwo-tiered client/server architecture: client computer networked to a
server computer with processing split between two machines
oMulti-tiered (n-tear): work of entire network is balanced over several
different levels of servers
4. Enterprise Computing Era (1992 to Present):
oFirms turned to networking standards and software tools that could
integrate disparate networks/applications throughout firm
oBusiness firms start to use TCP/IP networking standard
oLets info flow freely across organization and between firm and other
oIncludes telephone system, Internet, public network services
5. Cloud and Mobile Computing Era (2000 to Present):
oCloud computing: model of computing that provides access to shared pool
of computing resources over a network
o“Clouds” of resources can be accessed on an as-needed basis from any
connected device and location
Technology Drivers of Infrastructure Evolution
Moore’s Law and Micro-processing Power:
(1) The power of microprocessors doubles every 18 months
(2) Computing power doubles every 18 months
(3) The price of computing falls by half every 18 months
oNanotechnology: uses individual atoms/molecules to create computer
chips thousands of times smaller than current technologies permit
The Law of Mass Digital Storage:
oAmount of digital info is roughly doubling every year
oCost of storing digital info is falling by exponential rate of 100% per year
Metcalfes Law and Network Economics:
oThe value/power of a network grows exponentially as a function of the
number of network members
oNetwork members receive increasing returns to scale as more people join
oDemand for IT is driven by social and business value of digital networks
Declining Communications Costs and the Internet:
oRapid decline in costs of communication and exponential growth in size of

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oTo take advantage of business value associated with internet firms must
expand internet connections and power of client/server networks (ex.
wireless connectivity)
Standards and Network Effects:
oTechnology standards unleash economics of scale and result in price
declines as manufacturers focus on single standard
oComputing would be way more expensive without standards
Infrastructure Components
IT infrastructure is composed of seven major components
Components represent investments that must be made to provide firm with
coherent infrastructure
Computer Hardware Platforms
Include client machines and server machines
Ex. desktop PCs, netbooks, laptops but not iPhones or Blackberries
Client machines use Intel or AMD microprocessors
Server market uses mostly Intel or AMD processors in form of blade servers
Computer hardware sold by IBM, HP, Dell, Sun Microsystems
Chip producers: Intel, AMB, IBM
Intel is standard processor
Operating Systems Platforms
Most PCs use Microsoft Windows operating system
Unix and Linux are scalable, reliable and much less expensive mainframe
operating systems
Google’s Chrome OS provides operating system for cloud computing using
Android and iOS5 are mobile operating systems
Multi-touch interface: users use fingers to manipulate objects on scree (ex. iPad,
iPhone, iPod Touch)
Enterprise Software Applications
Firms expected to spend more than $160 billion in 2010 on software for enterprise
Largest providers of enterprise software application software are SAP and Oracle
Data Management and Storage
Enterprise database management software is responsible for organization and
managing firm’s data so they can be efficiently accessed/used
Leading database software providers: IBM (DB2), Oracle, Microsoft (SQL
Server), Sybase (Adaptive Server Enterprise)
Physical data storage market is dominated by EMC Corporations
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