There is a great deal of discussion at VMworld around cloud computing and a key ingredient is virtualization - which is a little like saying that cheese is important to Lasagna (sorry but my Italian comes out every now and then when I use food analogies).

First it is important to define what cloud computing is and who is going to use it. In my mind the broad definition of cloud computing is any data center that is highly virtualized and offers services to users near and far. And that my friends makes nearly every company in the world a candidate. This is an important point - since the requirements and characteristics of cloud computing must be considered for a broad audience. Since the cloud is not 100% physically tangible it better be uber-manageable. That is where the VIrtual Iron VI-Center comes in.

The more accepted definition of cloud computing is service providers that host data center infrastructure offering compute, network and storage services to external customers. People often jump to the conclusion that these service providers are big monster companies that have billions in assets. Tom Bittman, a senior analyst for Gartner pointed out in a conversation with me that he believes that there will be mid-tier cloud computing service providers that will play a vital role and have a major impact on the market.

I agree with Tom's analysis as evidenced by Virtual Iron's own customer base that includes a number of service providers offering cloud computing solutions - some for well over a year now. And like the rest of Virtual Iron's customers they get a bigger bang for their buck because they get true server virtualization that fits within the boundaries of their budget. This is critically important to service providers and their business models. It is all about scale and keeping infrastructure costs down - which is true of every operating environment - however since their revenue is based on this premise - it is their business do or die.

Cloud computing isn't a new concept by any means. However, virtualization takes it to another level. Virtual Iron is already there supporting the mid-tier cloud guys with a solution that makes much more sense at an economical level than any other competitive product- no ifs, ands or buts. For the larger guys - the same fundamentals apply - as well as greater flexibility with the willingness and ability to build true partnerships.