Aspinall and I have been having a series of deep-think chats about the fast-changing market for how big companies manage their ever-growing piles of information, software and hardware. He's my kind of corporate insider -- over his 20-some-odd-year career, including a long stint at Cisco ( CSCO), he's become an expert in getting the word out to impossible-to-spin big company chief technology officers. His latest message? Expect the unexpected when it comes to big businesses using the technologies that built the Internet to manage vast stores of company information. "Corporate data is becoming increasingly virtual. That means it can be placed anywhere," he explained. "it can be stored off-site or partially outsourced to other companies. Entire services can be outsourced." Aspinall says as this virtualization wave breaks, it won't be the copy of Microsoft ( MSFT) Word or the Dell ( DELL) PC or the Apple ( AAPL) iPhone -- or even the Google ( GOOG) Chrome browser -- that will matter. What will matter will be the "task."
"What software you run or laptop you use will not be the issue. It will be the task someone is trying to achieve that will matter," he said. "Once you think in terms of tasks, vast amounts of value can be unlocked."
Aspinall spins a good yarn on the transformative effect tasks will have on the business of selling software, hardware and networks to big businesses. Some tasks -- say, key compliance work or accounting or other information that an auditor (or senator) might want to see -- will have to be managed, much as they are today, on pricey computers in expensive locations controlled directly by company executives. But other, less sensitive tasks -- say, the company website or email or maybe its documents -- can be trusted to outsiders. These outsourceable tasks will be put up for bid in a vast, fast-growing global market in hosted business software services. And Aspinall is certain this global market in business tasks will behave just as the global markets in content, financial services or the legal professions: It will get smaller. Much smaller. "The increased efficiency enables four or five times as much work to be done with the same hardware," Aspinall said. Never mind all that sexy talk about big data in big enterprises being the once-and-future big profit center. What's really happening here is that the lifeblood of the corporate information economy is about to get commoditized.
"You are going to use the best equipment, but a whole lot less of it," he said. "A lot of the old suppliers will not survive this change." Corporate IT shows its tattered edges
What's fascinating about Aspinall's spin is that most reasonably qualified computer IT pros I spoke with agree completely. "Virtualizing the enterprise saves some of the cost of the software and hardware," Eric Chiu told me over drinks. Chiu is the co-founder of Mountain View, Calif.-based HyTrust, a firm that specializes in keeping corporate virtual networks secure. "But it's really all about saving the management fees for that software. It's just cheaper if companies specialize." Even more stunning, if investors dare see the corporate IT market through Aspinall's or Chiu's eyes, it's clear this sector is showing the early stages of full-on, digital-age collapse, a la the music industry circa 2001. Bellwethers are beginning to pull belly flops in the earnings pool. The highest-profile is IBM's ( IBM) missed earnings and revenue in April. There's also the declining shipments in core business hardware such as PCs, which fell 14% in the first quarter of 2013. And then there's the industry estimates for total IT spending, which are getting ratcheted back. "Faltering global economic growth, the euro zone crisis and the impact of Thailand's floods on hard-disk drive production have all taken their toll on the outlook for IT spending," was Richard Gordon's highly cited quote. He's no less than the research vice president at Gartner ( IT), the Stamford, Conn., research firm. But weary digital-age investors know what they're looking at: Just as in music, publishing, movies, law, economics and financial services, information is simply worth less. "When you can save 25% or 30%, somebody is going to step in, disrupt and take that margin," Aspinall explained. That all means, friends, the business of providing businesses with technology might be getting smarter, but it will also be getting poorer.