Very similar to the early cell phone adopters or high speed internet adopters, Cloud Computing has just begun.

For a long time many CIO's and CTO's were afraid to host their information in anything other than a box that they could literally touch. Now that technology and security have caught up with us, that trend is being reversed.

Throughout time networks and computers have done two things for sure. They have gotten smaller and relied on remote infrastructure to process information.

Kim Hart wrote an article in the Washington Post, where she points out that Cloud Computing does have some oposition who see this as just another hot buzz word that will soon fade like SAAS. She writes, skeptics say that it's nothing but hype.

"Cloud computing is the same old client-server computing we've known for years, except pretending to be intoxicatingly new and different and liberating," wrote Peter Lucas and Joseph Ballay in a report published by Maya Design, a technology research lab. "The marketing fairy godmother waved her wand over the whole 'new model' and pronounced it 'cloud computing.' "

Technologists say cloud computing is largely made possible by its distant cousins: open source and virtualization.

Sure open source and virtualization play roles in Cloud Computing, but there are a few things that differentiate it from a virtual server. In a true cloud computing environment one will find a few characteristics that can not be found in a typical hosted server supported by open source technology. Here one can find an elastic, state of the art solution, which can be adjusted with the click of a mouse and can handle any traffic spike.

In a single server environment there is a limit and human interaction to move to the next threshold.

The conundrum for many IT firms is it does at time cannibalize their existing, more traditional streams of business.

In a traditional IT environment there are charges and minimums for bandwidth, colocation (including space and power), hardware costs and a staff to support it. With the cloud, these are all condensed into one nice technology with a great total cost of ownership.

All of the technology sector follows one of two paths, up, or down. It is virtually impossible to stay stagnate, because the sector is evolving so quickly.

Right now the trend is to exploit the technology available to do more with less. Although the technology of virtualization has been around for quite some time, the adoption rate is souring and finally people are getting out of their own way in order to really get some business done.

The beauty of this is that it's just the beginning and it certainly will be a nice ride.

Great article I found on Forbes .

In light of all of the historical comparisons about the current economic situation and its proposed fixes, I'd like to offer my own perspective based on technology trends that have the potential to re-ignite growth for decades. My analogy comes from what at first sounds like an unlikely source: the automobile industry.

In the early 1900s, Ford ( F - news - people ) mastered the art of assembly line manufacturing, revolutionizing production techniques across industries, from consumer goods to large-scale machinery. What was once the privilege of the upper class became within reach of the average citizen.
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The efficiencies gained through mass production not only put a car in every garage, but also catalyzed consumer culture, reset the baseline standard of living and reshaped everything from how and where we worked, to how and where we lived.

The introduction of the assembly line began moving our economy away from an inefficient, build-to-order model to scale manufacturing. Over the last century, the automotive industry dramatically refined the art. Today, companies including BMW run highly automated factories that seamlessly integrate customers' orders with parts suppliers and dealerships. This configure-to-order model allows for customization not available in the Model-T era, while preserving and enhancing the efficiencies gained by the assembly line.

The early 21st century is like the early 20th century in that we are at the beginning of a new economic paradigm. This time, however, the engine of growth will not be manufacturing, but information.
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The equivalent of the assembly line is industry standard hardware, the components used to build the backbone of the largest Internet companies on the planet. Standardized hardware has unshackled the computing power once trapped in mainframe computers, democratizing it so that all can share. More recently, software has been developed that virtualizes, automates and differentiates this hardware to enable a configure-to-order model for the IT industry.

Even better: The "cloud" can deliver these capabilities and offer a new level of customization and efficiency at affordable prices and on a massive scale.

There's been a great deal of hype in the industry about cloud computing. To say it simply, the cloud is the next stage in the evolution of the Internet. Its impact, however, will be sweeping, fundamentally changing the way we connect with each other and with information.

The cloud is making once-expensive information technology available to a mass market through a pay-per-use model. This promises to increase productivity and drive growth. Small and medium-sized businesses can leverage data to drive efficiencies and improve products and services. Large companies can shift applications to the cloud and so spend their resources on the technology that gives them a competitive advantage.

More importantly, with this underlying infrastructure in place, both large and small companies can use technology to expand or invent services, open up markets and address some of the biggest challenges we face as a global society. For individuals, this promises services that are more intuitive, personalized and relevant in our daily lives. Here's one example:

HP has a cloud service, called MagCloud, that makes it possible for anyone to publish a professional-quality magazine and print, promote, sell and deliver it on demand. Printing on demand means no large press runs, no pre-publication expense, no waste.

By eliminating substantial pieces of the physical supply chain, we can offer professional-quality print to a mass audience while reducing the impact on the environment. The same on-demand technology can be extended to book publishing and allow individuals to print customized books, mixing their own content with that of professionals.

Looking ahead, we envision a rich ecosystem of printing services--connecting businesses to businesses and businesses to individuals--that delivers information where, when and how it's needed.

This is truly just the beginning. The cloud makes it possible to deliver everything as a service--from business processes to personal interactions--and to create altogether new business models across industries.

In my view, the ability to facilitate innovation and entrepreneurship in this new model is one of the most promising ways to ignite the next wave of economic growth. We can no more see the full impact of the cloud than Henry Ford foresaw the impact of his desire to produce more cars in less time.

Russ Daniels is vice president and chief technology officer of Cloud Services Strategy at Hewlett-Packard ( HPQ - news - people ).