Hardware as a service has too many benefits to ignore

The “as a service” mindset transforms the way companies and governments think about IT, as they discover how it supports innovation and enhanced service delivery.
Peter Clarke
By Peter Clarke, Founder and MD, LanDynamix
Johannesburg, 28 Jan 2021

Software as a service (SaaS) has changed the way we all think about software. The underlying principle − don't buy the thing, buy what it does − is spreading across the IT landscape. Hardware as a service (HaaS) is set to be the next big thing.

Already, the HaaS concept has spread beyond IT. The way we use all sorts of equipment, from cars, bikes and even trains, to safety gear and factory equipment, is beginning to shift.

What is HaaS? It has a passing resemblance to leasing but instead of renting equipment, one buys what the equipment does for a monthly fee.

HaaS has several advantages over leasing, not the least of which is that like any service agreement, it will have a service level agreement (SLA). Unlike the rental company, the HaaS provider doesn't just swop out equipment because it is responsible for the service the equipment is delivering, not the equipment itself.

The advantages of HaaS are manifold, and for the sake of clarity can be summarised as follows:

Attractive financial benefits

IT (or other) equipment is no longer a capital expense but rather an operational one. In addition, the cost becomes predictable and fixed − another benefit that CFOs appreciate as they plan cash flows.

The monthly cost can be structured to include maintenance − again, the fewer bills to pay, the more the finance department likes it. Best of all, perhaps, the total cost of ownership of the equipment can be substantially reduced; I have seen reductions of 20% or even more.

Maintenance and support taken care of

IT departments are perennially under pressure, and keeping equipment running is a big consumer of time and energy. Just about everybody in the typical office has a device of some kind, so the bigger the organisation, the more is involved in keeping that essential IT equipment running as it should.

Under a HaaS agreement, all that support would be the responsibility of the service provider. It should certainly be possible to deploy scarce skills from the IT department to more valuable work.

The underlying principle − don't buy the thing, buy what it does − is spreading across the IT landscape.

Service providers will harness the power of the fourth industrial revolution to gather and process data about the equipment for which they are responsible and undertake preventative maintenance to meet their SLA obligations. The resulting increase in equipment uptime will have a marked effect on productivity.

Always have hardware that is fit for purpose

IT hardware is in a state of constant proliferation and as the fourth industrial revolution gathers pace, more and more devices and sensors will be added to the IT department's responsibilities. Managing the life cycles of this growing hardware estate is enough to tax the patience of a saint, let alone your average harassed IT manager.

In the HaaS world, the focus is on the service being delivered, so the service provider will be constantly keeping up with new hardware releases to keep the service constant. To illustrate this, consider the number of machines designed for Windows 7 that are still in service − Windows 7 is out of support and many of them cannot run Windows 10 satisfactorily, with resulting substandard performance.

Importantly, as the hardware is refreshed, it would be configured and installed to continue delivering the service that was purchased.

The link between having the right hardware and the ability of the software on it to perform is spawning an interesting set of variations on the "as a service" theme.

One example is Microsoft's Surface as a service, in terms of which Microsoft is offering its Surface devices bundled with Office 365 and, increasingly, with specialist software designed to run on it.

Booz Allen is developing applications for government designed to take advantage of Window 10's advanced security features. Another is a joint Microsoft / IBM venture to leverage the latter's expertise in data analytics by creating sector-specific applications designed for the Surface tablet.

Reduced innovation risk

Low upfront costs and the avoidance of long-term capital investments mean that companies and the public sector are freer to experiment with new technologies and the opportunities they might unlock.

We are always being told about the importance of innovation, but less about how risky it is. Most companies just don't have the resources to buy a lot of equipment (and take on the associated maintenance and support) only to find that the new idea doesn't fly.

By contrast, the HaaS model makes that kind of innovation possible. The fourth industrial revolution is technology-intensive, so HaaS makes its benefits more accessible.

HaaS's benefits are reflected in predictions that it will grow at a compound annual growth rate of 26.2% over the period 2020-2025.

As COVID has taught us, technology is an essential strategic component in an uncertain world − HaaS makes it more affordable in all sorts of ways.