Is cloud computing more than just smoke?

The growing buzz around cloud computing sounds eerily familiar to the utility computing noise of a few years ago.

But there is a difference--or at least people in the business swear there is.

In reading blogs and speaking to a few people, I've found that cloud computing does indeed rehash some of the ideas of the past, but there are significant technology advances, notably virtualization, that set it apart.

One such cloud company, Elastra, launched on Tuesday its server for public and private clouds. Executives at another start-up, 3Tera, told me on Monday that later this year their AppLogic "grid operating system" will let people use a single tool to deploy applications that run on a mix of Linux, Windows, and Solaris machines.

What's the link between cloud and utility computing? For starters, there's pricing. With utility computing, you get computing "power" when you need it and you pay based on consumption.

This makes sense for people who don't want to invest in building their own data centers or don't want to buy all the hardware required to handle "peaks" in demand. You can rely on outside provider to give you servers, storage, and bandwidth as you need it.

Cloud computing builds on that pay-per-drink model but makes it easier to deploy and manage applications at remote hosting providers, according to adherents.

Perhaps the most high-profile company now doing this is Amazon Web Services, which is aimed primarily at tech start-ups that like the low up-front cost.

As Microsoft builds out its own "cloud infrastructure," it's very likely the company will offer similar hosted computing services, such as hosted storage and servers. Last month, it announced a hosted database offering. Meanwhile IBM, Sun Microsystems, and Hewlett-Packard all offer some variation of hosted utility computing.

To run an outsourced computing service effectively, service providers need automation tools. After all, there's a limit to how many servers a single person or small group of people can manage; productivity tools for IT administrators help operations scale.

A whole wave of companies were formed in the beginning of this decade to automate various tasks of data center operations, from provisioning servers to managing configurations.

Memorable "exits" from this wave of start-ups were HP's purchase of Opsware for $1.6 billion and BMC's acquisition of BladeLogic earlier this month for $800 million.

These go to '11'
But now there are new start-ups promising to do that data center automation better than before and make it easier to deploy applications out onto the Internet "cloud."

In a recent study, Forrester Research identified 11 companies that it called "cloud providers." The list includes hosting companies like Rackspace, as well as development platform providers like Salesforce.com. Systems management expert John Willis has also created a list of cloud providers and tries to demystify the concept here.

Prominent in Forrester's list is 3Tera, a company that released its first product last year. Its AppLogic creates "virtual appliances" that define which resources an application needs in order to run. A Web server, for example, may need a certain amount of memory and storage.

This allows system administrators or application architects, using a Web-based graphical tool, to set up an application choosing from a pool of servers or storage devices made available by a hoster.

"We do believe there is a difference between utility computing and cloud computing, but we believe that they aren't mutually exclusive," said Barry Lynn, 3Tera's CEO and the former CIO at Wells Fargo. "We don't understand how you can have an effective cloud unless it's deployed on a cloud platform."

The company's own software is, of course, hosted. Lynn said he believes that the next Google won't run a data center--it will get computing from the cloud.

What's different from 3Tera's approach and previous grid and utility computing automation tools is that people can work with an entire application rather than taking a piecemeal approach, company executives say.

By contrast, previous generations of tools were built to handle specific tasks, like provisioning servers, which are needed to get an application online, said 3Tera co-founder and vice president of sales and marketing Bert Armijo. The result is that application architects can get applications deployed quickly and system administrators can handle more equipment, he said.

Elastra makes the same claims of making it easier to deploy databases to a cloud and manage them. EnterpriseDB is using the Elastra software to have its database hosted on Amazon.

The Elastra Cloud Server creates files that define what's needed to run and manage an application. Dana Gardner at InterArbor Solutions has more here.

Elastra CEO Kirill Shaynkman, who founded portal company Plumtree, said that the software allows people to deploy databases quickly at both remote locations (hosters) or in corporate data centers.

"There are other clouds that are coming; Amazon is the most public and friendliest right now," he said. "There are private clouds already. They are just unmanageable right now."

Of course, issues associated with outsourcing remain despite all the technological progress.

When Amazon Web services went down for several hours in February, it was a rude awakening for many Web 2.0 companies that use the service without an offline backup.

But even with glitches along the way--and a healthy dose of hype from vendors--cloud computing makes it look like the idea of having computing flow like electricity is inching closer to reality.