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Utility Computing Definition & Meaning

Utility computing is a service offered to businesses or individual technology users in which a designated provider offers basic computing technology on a pay-per-use plan. This can include multiple off-premises computers, off-premises servers, and cloud computing. Utility computing has been around for decades, and it has expanded to include cloud services as the need for cloud infrastructure and hybrid computing grows.

The initial vision for the term was that companies would someday pay for compute power as they now pay for electricity, but that vision remains a long way from being realized, as most organizations maintain significant on-premises processing power.

Today the term utility computing is not as commonly used, but it's still applicable whenever a company pays a computing provider to use their services. It is often referred to as cloud computing simply because most providers now offer pay-as-you-go cloud infrastructure. Another term for this is Infrastructure-as-a-Service, which offers cloud infrastructure paid per use.

Utility computing makes computing more economical and saves computing resources because users only pay for what they use, rather than paying for infrastructure that sits unused when demand doesn’t meet capacity. It can also manage resources by utilizing virtual machines and other virtualization techniques and using computers more efficiently. Businesses benefit from the flexible nature of utility computing now that many UC providers offer cloud computing services. It's important to choose an established UC provider, however, so that customers don't get trapped by a provider that tanks financially down the road.

Computing providers

These providers are some of today's best known cloud computing providers, and most of them offer a pay-per-use plan.

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