Virtualization and cloud computing are promising to change the way in which IT services are delivered and, in effect, transform computing as we know it today.  I think the promises are likely to come true, if and only if critical technology issues are addressed.

Nicholas Carr told a recent audience at IDC Directions that "Cloud computing has become the center of investment and innovation."   While he is not a technologist, his sometimes shocking insight into the transformation of IT have been prescient, even if he doesn't sweat the details of how complex IT infrastructures can morph into the equivalent of today's public utilities.

To his credit Carr has predicted the rise of the cloud computing press release, multiple cloud conferences and panels and even the SaaS repositioning exercise.  He also foresaw the rise in Amazon and Google cloud announcements, perhaps years ahead of profits and/or material revenue. 

Here is an example of a billion dollar repositioning exercise as covered in CIO Magazine's online blog:

In late February 2009, Salesforce.com CEO Marc Benioff proclaimed that the software-as-a-service CRM maker was "proud to be the first billion-dollar cloud computing company."  - Thomas Wailgum, CIO Magazine March 9 2009.

Along with his vision it would be refreshing for Carr to address some of the technological and microeconomic issues that will need to be resolved for his vision to take hold.  And by take hold, I'm talking about viable models of cloud computing as he describes them; not software as a service or a rack of hypervisors on a private VLAN or a management tool that enables some limited pooling or processors for a single application.  IT as a service is much bigger than these early accomplishments.

The cloud computing models that Carr describes will require fundamental breakthroughs in the way networks, applications and endpoints interoperate.  It will require unprecedented automation inside the network as well as an unprecedented scaling of network capacity.  I wrote earlier about The Three Horsemen of the Network Revolution (virtualization, cloud and netbook computers); the common theme was the rising tide of demands on the network and the opportunities it would create for savvy network vendors.

After all, Carr's cloud will require a robust network, or dynamic network infrastructure, something he doesn't cite as significant.  Yet the network is more than just a mesh of cables; application delivery is more than a power switch and applications have more complex and ongoing interactions with endpoints than the most complex power grids.

I think it is this disconnect between a systems-centric view of IT and the reality of the state of the enterprise network today that has fueled the rampant, hyperbolic speculation about the ascent of cloud computing and the resulting rush to be relevant.  So let's talk a little bit about at least one element of what Carr is missing and the implications for CIOs.

• Is Nick Carr Right About Cloud Computing?
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