Global initiatives aimed at making high-performance computing services for businesses available, much like electricity from a wall socket, will accelerate over the next 18 months, spurring more mergers and acquisitions in the information technology sector. The forecast comes from New York-based IT market analysis firm The 451 Group, which noted more than US$1 billion worth of mergers and acquisitions in the year to September 30. The deals were pursued by IT firms eager to build their grid computing resources. That outlay was on top of IBM's initial $10 billion commitment, made in October last year, to develop technologies, products and services for its e-business on demand strategy, which offers businesses an array of internet-linked, high-performance computing system and services - the grid - on subscription-like utilities. The grid is designed to render almost anything in IT (processing power, data, web services, storage space, applications or devices) as a low-cost 'grid service'. The increased availability of always-on, broadband internet connections in many countries has helped get the grid concept out of the labs and into the service of businesses. The 451 Group said last week that grid computing offered significant consulting and professional services opportunities for IT vendors that already had such resources. For IT players without those capabilities, partnerships were the best way to stay competitive. IBM, Hewlett-Packard, Microsoft and Sun Microsystems were identified by The 451 Group as top-tier vendors in the grid computing market. The second tier included Intel, Oracle, Computer Associates, Silicon Graphics and Veritas. 'Pure-play grid vendors', The 451 Group said, have strong technology portfolios in specific areas, but must evolve - 'through rapid growth, investment or acquisition' - to remain competitive in the grid computing market. These firms include independent software vendors (ISVs) such as as Altair, Avaki, Axceleon, DataSynapse, Ejasent, Enigmatec, Entropia, GridIron, GridSystems, Tsunami Research and United Devices. IBM recently allied with Massachusetts-based Avaki and United Devices of Texas to package and offer their grid technologies to businesses of all sizes. Michael Lawrie, IBM senior vice-president and group executive for sales and distributions, said the firm was keen to form similar partnerships across Greater China and the region, where local ISVs and systems integrators could reach deeper into domestic markets. 'We have received plenty of positive feedback from both the public and private sectors in the region since the launch last year of our e-business on-demand strategy,' he said. Other large IT firms seem to have followed IBM's lead by making grid-related investments over the last 12 months. 'Despite the competition, we are confident of leading this new market.' Analysts estimate that grid software and services will become a $4 billion global market by 2008, but prominent IT players such as HP and IBM expect the market to be significantly larger as corporate IT departments embrace the grid. Jamie Gruener, Yankee Group senior analyst for enterprise computing and networking, said: 'While hardware vendors are making the investment, as are some ISVs, most other firms are waiting for the [grid computing] products to develop before they identify preferred product strategies.' However, Mr Lawrie noted that governments and academic institutions (including those in Hong Kong and the mainland) have taken the lead in realising the commercial benefits of grid computing. Professor Tsui Lap-chee, vice-chancellor at The University of Hong Kong, announced last month a six-month pilot project to provide grid-computing services to the Environmental Protection Department. He said this underscored the government's 'solid commitment' to adopting grid computing. In July, IBM Greater China Group chairman and chief executive Henry Chow forged a deal with the Shanghai municipal government to support its development of grid-computing skills and resources. The 451 Group predicted that grid-computing developments will result in commercially viable, mainframe-like performance and manageability across networks within the next 12 months. Financial services, life sciences and manufacturing industries were the earliest to test and partially adopt these systems.