Cloud Computing...Is this something new?

I see a lot of buzz on the web about cloud computing. People ask; Is this the end of IT departments?, Does cloud computing put a stain on IT departments?, Which applications are best suited to the cloud?, etc.

From my perspective, cloud computing has been around for a very long time, albeit by other names. I worked for a bank service company and we provide thousands of banks with all of their business application over a secure network (before the Internet) and eventually over the web. In addition, I worked for BNY Clearing where we provided a brokerage workstation platform that was 100% web-based to hundreds of investment companies in the late 90's and early part of this decade.

I don't think cloud computing is a terribly huge deal for IT departments and I dont think there are too many applications that wont work well in the cloud. IT departments should approach these opportunities just as you would any outsourcing decision. The good news for IT is that there is an ever growing list of service options to consider.

The key IT challenges will center on security, identity management, and compliance issues. From an end-user perspective password management will be huge. Your users wont want to have to remember dozens of passwords.