Cloud computing, which offloads applications from local PC installations to the Internet or company networks, stands poised to free business from many uncomfortable tethers.  For one thing, those local PC installations, and the operating systems they require, can be a royal pain to manage and update. Not to mention the potential for data loss with local storage - sure, you can create good backup policies and train users to store files on network drives, but you're still going to run into situations where a drive blows and someone loses a critical document.
Software-as-as-service and network-hosted applications are going gangbusters precisely because they stand to do away with those limitations.  A new special report section from BusinessWeek on cloud computing, with articles such as How Cloud Computing Is Changing the World and Cloud Computing: Small Companies Take Flight cover the benefits of systems like Google Apps and Salesforce.com for businesses large and small.
The pieces also cover the limitations, such as a much smaller feature set in online document apps like Google Docs compared with Microsoft Office, and the eggs-in-one-basket risk of hosting a business-critical app on Amazon S3, which recently suffered a major outage.
But those limitations will fade as systems expand and add more features and fault tolerance, and I think it's a safe bet that cloud computing will become the norm relatively soon.  Not tomorrow, but soon.
And I'd say Microsoft knows it, too.  Such thinking had to play a part in its recent failed bid for Yahoo, and new revelations about an under-development Midori operating system show that Microsoft intends the long-range OS to be ready for a virtualized, cloud-computing user base.  According to an SDTimes.com technical analysis of published reports, "Midori will have provisions for distributed concurrency-or cloud computing-where application components exist in data centers."
For my part, I already use Internet-based apps such as Google Docs, RingCentral and Zoho Invoices for most of my day-to-day work, and I love the freedom they afford me. I think we're on the cusp of a major paradigm shift with cloud computing, and I'm eager to see how it plays out.
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