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The Networked Cloud

Stocks in this article: IBM T GOOG AMZN

NEW YORK ( TheStreet) -- The deal announced Wednesday between IBM (IBM) and AT&T (T) to join forces for building secure corporate clouds was seen by ComputerWorld's Richi Jennings on his blog as appealing to "fearful firms."

But it reminds me of something very important about cloud technology and how it's evolving. As Greg Johnsen wrote at Wired a few months ago, "the future belongs to cloud-networked companies."

The future is not about "a" cloud, or "the" cloud. It's about a network of compatible clouds, clouds that can move workloads anywhere, which have redundancy, which are, in short, everything the Internet itself is.

Google (GOOG) and Amazon.Com (AMZN)both offer networked clouds, but as we learned when Amazon's Washington-area data center was hit by lightning in June, reported in Forbes , you have to pay up for that.

Cloud technology uses virtualization and distributed computing techniques to let you address a whole bunch of commodity PCs as though they were one system. This lets you scale services to demand and serve a whole bunch of people if they decide to rush your Web site after you run an ad on, say, the Super Bowl.

Right now, most customers of public clouds are going for the cost savings. It's an adjunct to their "real" enterprise systems. But IT managers worldwide are rubbing their hands with glee, looking to a day when they can scrap their IT rooms entirely.

That will take time to make happen, but meanwhile they're experimenting with single cloud installations of their own, called "private" clouds, and making those installations a back-end to public cloud workloads, creating "hybrid" clouds.

But when they look out, three-to-five years into the future, they insist on keeping everything they have now. They want security guarantees, they want to know who to call if things go wrong. In short, when big enterprises think of the networked cloud they want the savings of cloud, and the global reach of cloud, along with the security and control they have with enterprise systems.

What this tells me is that the cloud market is not going to remain a free-for-all, with hundreds of companies jostling for position and offering bits and pieces of a solution. It's going to consolidate, probably around the biggest public cloud players, because giving enterprises what they demand requires scale.

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