If you eavesdrop on an IT discussion nowadays or drop in on an IT forum, there appears to be only one topic of conversation: the weather. Every IT manager, it seems, is talking about how cloudy their environment is: how their private cloud, public cloud, or hybrid cloud is developing. What’s going on? Why the obsession with grey skies when they should be blue-sky thinking their way through the IT management challenges?

Well, this is no ordinary chat about clouds. Their discussions are all about cloud computing. It’s a term based on the cloud drawing used in the past to represent the Internet in computer network diagrams. The easiest way to understand what it’s all about is to liken it to the electricity grid.

Cloud computing is Internet-based computing, whereby shared resources, software, and information are provided to computers and other devices on demand, just like you’d plug your PC into the electricity grid. You pay for what you use. There’s no upfront investment. And all the risk is with the electricity provider ? not you.

In the cloud, details are abstracted from the users, who no longer have need for expertise in, or control over, the technology infrastructure in the cloud that supports them. It frequently takes the form of web-based tools or applications that users can access and use through a web browser as if it were a program installed locally on their own computer. Salesforce.com is a good example of how the technology works.

The company is a ‘software as a service’ company that distributes its customer relationship management (CRM) business software on a subscription basis, hosting the applications offsite. According to Gartner, increased demand for cloud services would take revenues from $58.6bn last year to as much as $148.8bn by 2014[1]. North American and western European firms are the largest consumers of cloud services, they report, representing over three quarters of the market. The UK is expected to account for almost a third of all cloud-using businesses by 2014.

Private clouds and public clouds

Clearly, there is nothing short of a revolution taking place in IT. The business can get near-instant, self-service access to a wide range of services, paying as they go for what they use. IT can create private clouds to more quickly and efficiently meet business demand with services that scale in and out across a shared pool of resources. And IT can more efficiently focus on its core competencies by using public cloud services to provide extra resources or handle non-core capabilities.

The promise is real, but so are the challenges. The concerns in adopting the cloud computing model generally fall into four categories: security and compliance, performance and reliability, loss of control, and production transition.

First, security and compliance ? where regulations such as drive the need to be extremely cautious with data, with serious legal ramifications in the event that data is compromised. Many companies are also uncomfortable with their data being located on hardware outside of their direct control. This unease quickly turns to fear when you add the fact that cloud computing services are inherently multi-tenant, meaning that other companies, even competitors, are sharing the same hardware resources.

The second major concern about cloud computing is performance and reliability. While a service level agreement can be structured to meet the demands of various businesses, there is always a small margin for error. Internal IT departments are often judged by the uptime of their most important applications.

Cloud service providers like Amazon and Google offer guarantees of 99.9% uptime, likely significantly higher than internal teams can manage for most applications. But many IT organisations worry about the health of their applications in the event of an outage or performance degradation with one of those providers.

Cloud computing equals loss of control

The third worry is loss of control. Companies are hesitant to push mission critical applications and data such as CRM to an external enterprise over which they have much less control. Any trouble with the cloud service provider ? such as bankruptcy – could jeopardise the consumer’s business.

And even though the risk with companies like Google and Microsoft are very low, enterprises may still fear becoming too dependent upon even these large and stable cloud service providers. Organisational inertia and cultural impact have often proved to be far greater barriers to adopting new technologies than technological feasibility.

Finally, cloud computing raises the issue of production transition. How do you transition your production environment, either in part or whole, to the cloud without interrupting the business? For example, you need to capture both the state and data for applications and servers, store the data to enable recovery if necessary, and physically move the applications and servers ? potentially in real time.

Agile delivery of cloud services

Fundamentally, cloud isn’t a new technology to be managed. Cloud computing is a way of delivering, consuming and managing technology. IT management will help your organisation overcome all of these difficulties, delivering capabilities like virtualisation management, dynamic provisioning, self-service and resource metering.

Planning, security, assurance and support are needed for both effective delivery and responsible consumption of cloud services. To continuously improve its business value, IT needs management to help drive fact-supported choices on which services to build or cloud-source, which public cloud services to use when, and to dynamically orchestrate how it all comes together –internal and external, virtual and physical.

Unlike solutions that approach one narrow aspect of cloud computing from the bottom up, it’s important to look into solutions that approach both public and private cloud computing with a top-down application and service perspective that allows you to focus on greater business value. This will help leverage existing technology and management investments into cloud computing using a ‘single-pane-of-glass’ approach across virtual, physical, and cloud management, and with flexible integration across technologies, platforms, and processes.

With effective IT management, you will be at the centre of cloud discussions among your IT management peers; not an outsider looking in.