Abstract
One of the most misunderstood aspects of managing information technology is the attendant economics. The rate of technical advancement is accelerating, demand is intensifying, standards and architectures are changing daily, prices are falling, but total costs are growing. Yet the legacy-based fiscal thinking of both technologists and financial officers has changed little in the face of these new realities. Understanding the economics of information technology is a necessary first step toward developing sound financial strategies to accommodate technological advancement. This article is an updated version of CNC9508. "The Financial Mythology of Information Technology: Developing a New Game Plan" (CEM9624) is a follow-up article to this one.