IBM Wednesday announced a new service that lets companies outsource management of their data center and get billed based on service usage volume - as opposed to upfront fees - without transferring data center IT assets and employees to the outsourcing provider.

Previously, in order to engage IBM in an outsourcing project with flexible usage-based billing, clients had to ferry over to IBM related IT assets and employees, an IBM official said. "This is something we haven't done before," said Dev Mukherjee, vice president of e-business marketing and strategy at IBM Global Services.

The new service, called Strategic Outsourcing Flexible Support Option, will not only offload data-center management tasks from the client's IT department, thus saving clients money and freeing the staff to do higher-level work, but also improve the data center's operation, he said.

"Existing customer environments are often siloed, especially if the company has gone through acquisitions or implemented a variety of application suites. The company ends up with islands of technology," he said. "We bring business discipline to turn those islands into a pool of technology. This pooling approach increases data center flexibility and utilization."

With this new service, IBM's Global Services unit remotely manages a company's data center from an IBM facility, using its Universal Management Infrastructure (UMI), he said. UMI is a combination of systems management, software deployment and configuration management software, architecture workflows and outsourcing methodologies, he said.

Four major steps are involved in rolling out the service for a client, he said:

* First, IBM does a thorough assessment of the client's data center, to map the infrastructure and identify ways to improve it.

* Second, IBM moves on to consolidating and standardizing the data center environment, to simplify its management.

* Third, UMI, created two years ago and rolled out last year, is deployed to link the client's data center with the IBM remote management site;

* Fourth, IBM provides ongoing remote management, most of which is automated, of the client's entire data center, or of parts of it, including applications, storage devices, servers and networks.

Pricing varies depending on the scope of the engagement and is based on the number of components being managed and on service usage volumes, he said. This makes it an example of IBM's "on demand" model, in which clients pay according to usage, an increasingly popular option in the IT industry. This is also referred to as "utility computing," to indicate that, in this model, clients pay for IT resources in a similar way to which they pay for utilities such as water or electricity.

The IDG News Service is a Network World affiliate.