According to its advocates, cloud computing is poised to succeed where so many other attempts to deliver on-demand computing to anyone with a network connection have failed. Some skepticism is warranted. The history of the computer industry is littered with the remains of previous aspirants to this holy grail, from the time-sharing utilities envisioned in the 1960s and 1970s to the network computers of the 1990s (simple computers acting as graphical clients for software running on central servers) to the commercial grid systems of more recent years (aimed at turning clusters of servers into high-­performance computers). But cloud computing draws strength from forces that could propel it beyond the ranks of the also-rans.

Rather than running software on dedicated hardware--a mail server here, a database host there--cloud systems can let software run on virtual machines, simulated systems generated at a moment's notice in massive data centers (see "Water-Powered Computers"). If a customer's needs expand, more virtual machines can be created and configured with ease, and should those needs later decline, the underlying hardware resources are returned to the data center's pool.

No elaborate construction or development program is needed to kick-start such technology--the infrastructure is already in place and making money. Existing data centers, built to support the likes of Amazon and Google, can rent spare capacity, creating a collection of services that provide the illusion of infinite computing power and storage on tap. Technologies like virtualization (as explained in "Conjuring Clouds"), combined with growing market pressures to reduce capital spending (see "Virtual Computers, Real Money"), could revolutionize the software industry, enabling startups to offer online applications or services without investing much in storage, Web, or e-commerce infrastructure. End users could have seamless access to applications and data anywhere, on any device.

As reported in "Making Art Pay", eliminating the need for infrastructure investment allows rapid development of applications. An ecosystem of startups has sprung up to provide platforms, tools, and expertise--recently joined by companies such as IBM and Intel (see "Companies to Watch"). As a still-maturing technology, however, cloud computing has yet to overcome certain challenges, such as guaranteeing the integrity and security of users' data, providing a seamless user experience, and establishing standards to allow companies to move from provider to provider (see "The Standards Question"). A number of key players are driving many of the industry's responses to these challenges, and open-source efforts and academic research consortiums are likely to play a role as well (see "Open-Source Projects and Research Consortiums").

A survey of corporate software buyers by the 451 Group showed the use of public cloud computing increasing by more than 60 percent in the last quarter of 2008 over the previous two quarters, and International Data Corporation has predicted that business IT spending on cloud services will rise from $16 billion last year to $42 billion by 2012, setting up cloud computing as one of the few areas of growth in an otherwise gloomy economy.