Cloud computing is the most significant development for IT since the invention of the PC. It's impact on IT will be similar to the paradigm shift Apple's iTunes caused in the music industry, namely selling music by the song instead by the album. (In IT's vernacular: the ever-elusive consumption of services by-the-drink ... or utility computing on steroids.)
Before Apple, MP3 music players were everywhere. So, it wasn't that the iPod was such a revelation; what Apple did was figure out that people would prefer to buy individual songs if they could download them easily, quickly and cheaply. By thinking of music as a service instead of a product, Apple was able to identify and provide a new method of consumption--one that, because of Internet delivery, completely changed the way people purchased and consumed music. Now, with the iPhone, that paradigm is expanding to all manner of Internet-enabled services.
Cloud (also enabled by the Internet) will have this same affect on IT. Not for IT's customers--they will probably never know that the application they are using is coming from the "Cloud"--but on IT itself and more importantly it's relationship with the business. Cloud is potentially the game-changing paradigm that will rewrite the way businesses view, use and pay for technology.
"Companies that are smart are taking a look at the varied aspects of Cloud and pushing certain applications up (into the Cloud) and those that need unique distinguishing characteristics they push down (into the traditional data center environment)," said Doug Neal, a research fellow with CSC's Leading Edge Forum Executive Programme, and co-author of the report Doing Business in the Cloud - Implications for Cost, Agility and Innovation.http://lef.csc.com/research/projects/Default.aspx?id=9522 "IT has to realize that it's in kind of a precarious position. It can either accelerate this change and gain great glory or they can sit back in denial and just atrophy."
According to the report: "The most important value the cloud brings is not lower costs. It is improved agility, not just for IT, but for the business as a whole." This is accomplished by allowing companies to off-load anything and everything about their IT infrastructures to an outside provider. While this is not new, the way it's done is. With Cloud you contract to only for the services you need as you need to consume them. You don't have pay for 24/7/365 anything. A great example, said Neal, is dev/test.
Read the rest at CIO Update.