AT&T joining cloud-computing field

Update, 8:32 a.m. PDT Tuesday: Makes note of actual AT&T announcement.

AT&T is joining the burgeoning field of cloud-computing service providers that offer networking and storage services, according to a report late Monday on The Wall Street Journal site.

Cloud computing, which has attracted such heavyweight players as Google, IBM, and Amazon.com, relieves companies of the burden of managing their own data centers. One of AT&T's first customers will be the U.S. Olympic Committee, which runs Teamusa.org and other Olympics Web sites, according to the newspaper. AT&T's services will help manage event videos and results as on the organization's sites as traffic spikes during the Beijing Olympic Games.

Another sector AT&T expects to benefit from with this service is e-commerce. Jim Paterson, a vice president of product development at AT&T, told the Journal online retailers could use the service to help manage spikes in shopping activity, such as the day after Thanksgiving.

However, while cloud computing is very attractive to large businesses, it also carries risks. Last month, Amazon's Simple Storage Service (S3) experienced an extended outage that cut off many companies from their data. Amazon offered an automatic credit to companies affected by the outage, but the outage highlighted the vulnerability posed by relying on a data center that companies don't have physical control of.

On Tuesday morning, AT&T officially announced the service, called AT&T Synaptic Hosting. The company said that it would have five regional gateways, or "super Internet data centers," for the utility computing service, located in Piscataway, N.J.; San Diego; Annapolis, Md.; Singapore; and Amsterdam.