In recent years there has been a trend towards selling software “as an appliance”. There are many advantages to doing so:

• An appliance is a server in a box, which can be built to be “plug-in, load and go”. There is a perception (usually accurate) that implementing an appliance will be trouble free.
• The supplier controls the whole stack within the appliance, from the OS through to the application, and thus integration problems throughout the stack are rare or non-existent.
• Support can be convenient and effective, since the supplier can (if allowed) connect and provide support remotely.
• As a consequence of the last two points, appliances are easier for the supplier to sell through channels.
• For the customers, the appliance appears to be isolated in its activities, requiring no integration, and hence presents less risk. Also the customer has a single “throat to choke” in the event of problems. Appliances are particularly attractive to small and medium-sized businesses that have no skilled IT staff.

Recently, however there have been disadvantages emerging:

• In the main, servers are no longer bought as rack-mounted boards, but as blades that fit into a blade cabinet which has a common format. However there is no blade standard. Dell blades are not the same as IBM blades or HP blades. Hence it is no simple matter to transform from appliance (rack sized box) to blade.
• In large corporations this “disadvantage” for appliances is compounded by the need to have a power supply strategy. The unintegrated nature of appliances now works against them.
• It also works against them as regards virtualization strategy, as an appliance is unlikely to be able to participate in such a strategy. Again this is a penalty that comes from the unintegrated nature of the appliance.

We therefore expect appliance vendors to begin to broaden their implementation options to include:

1. An appliance as now, for smaller businesses, where there is still good reason to buy in this form.
2. The software hosted, or if you like, Software as a Service (SaaS).
3. As an application that is configured to a virtualizable resource space.

The movement away from appliances is a natural consequence of Moore’s Law. Moore’s Law dictates that, over time, more and more functionality will fit into any given “form factor”. With the passage of time, the form factor of an appliance is simply becoming too large to house a single application.