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ON-DEMAND COMPUTING A SUCCESS FOR IBM

IBM generated $7 billion in orders in the last year for its the "on demand" computing services, and saved another $7 billion by applying those services to its own operations.

The new strategy -- allowing customers to get computing power over the Internet as they need it -- represents a small but growing trend in information technology services.

IBM's efforts are in some ways a step back to the mainframe computer world IBM has long dominated.

This new approach to computing enables customers to add computing capacity when needed by integrating industry standards like the Linux operating system and new Internet-based protocols.

IBM is not alone in its effort to promote on-demand computing that uses the Internet to allow companies and their divisions to share computing power. HP, Microsoft and Sun Microsystems are trying to persuade customers this is the future of computing, with varying degrees of success.

Microsoft recently recast its .Net initiative, saying that the set of computing standards it developed for businesses will become part of its Longhorn operating system, which it intends to introduce in several years.

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