Welcome to the latest BriefingsDirect Insights Edition, Vol. 34, a periodic discussion and dissection of software, services, services-oriented-architecture (SOA) and compute cloud-related news and events, with a panel of IT analysts and guests.

In this episode, recorded Nov. 21, our experts focus on the impact that cloud computing will have on the large, established IT vendors. We really are only beginning to understand how the IT services delivery, data management, and economic models of cloud computing will impact the market. If this shift is as large and inevitable as many of us think, the impact on the current IT business landscape will also be large. Some will do well, and some will not. All, I expect, will need to adapt, and the shifts are certainly exacerbated by the deepening global recession.

Please join noted IT industry analysts and experts Jim Kobielus, senior analyst at Forrester Research; Tony Baer, senior analyst at Ovum; Brad Shimmin, principal analyst at Current Analysis, and Joe McKendrick, independent analyst and prolific blogger on ZDNet and ebizQ. Our discussion is produced and moderated by me, Dana Gardner.

Here are some excerpts:

Baer: In terms of who is best positioned for all this, I think it's a little too early to tell, because most of the large vendors are only just starting to put their feet in the water. Obviously, IBM, HP, and Microsoft are making moves. SAP has actually had a couple of stumbles on the way there. Oracle has sort of a sitting-on-the-fence strategy.

If we are going to talk about who has consistently positioned themselves as being the poster child, it has been Marc Benioff over at Salesforce.com, where they have evolved from a customer relationship management (CRM) application that you access on demand to expand towards Platform as a Service (PaaS).

Gardner: Who can get kicked in the teeth by this thing?

Baer: Well, Microsoft clearly could get kicked in the teeth, and that's obviously why they've come out with their resource strategy and with their various live-office strategies. Microsoft clearly has the most to lose, because they've been very identified with the rich client.

Gardner: Yet Microsoft has an opportunity to shoot for the moon. They have all the essential pieces. They have a very difficult transformation to make in terms of their business. They have a lot of cash in the bank, and we're in a transformational period.

I think Microsoft has an opportunity to make an offer that developers can't resist—and probably no one else is in a position to do it—which is to say, "We will have at least one of the top three clouds. We're going to give you the tools and give you simplicity that Joe the plumber can develop, and we're going to make sure that you have a huge audience of both consumers and businesses that we're going to line up for you."

McKendrick: They've already made a lot of moves in this direction: Software plus Services, the Live offerings. They're already positioning a lot of their product line. They work with Amazon and have offerings through the Amazon service as well. Microsoft gets into everything. Wherever you look, in the enterprise or in computing, they have some kind of offering there. Sometimes, the things don't take off for a while. They sit and bide their time, and eventually it takes hold.

... Thinking about the Microsoft plus Yahoo, it makes really good sense for them both to be a real powerhouse together in cloud computing. Earlier, I stressed that the providers who dominate the cloud world will be those that focus on extreme scalability, scale out, shared nothing, massively parallel processing being able to sift and analyze petabyte upon petabyte of data from all over especially of the Web 2.0 world especially clickstream information, and so forth.

Gardner: On the other hand, for those not shooting for the whole package, is this going to democratize IT?

Shimmin: When you look at the strategy vendors like IBM has, Sun will have, and Cisco has, in terms of how they're rolling out anything that's in the cloud—whether its PaaS, infrastructure as a service, or SaaS—they all seem to be doing two things.

One is that they are taking some point solutions that they are going direct with, like IBM with Bluehouse, for example. Secondly, they are going after an independent software vendor (ISV) market. They want to empower folks like amazon.com, Panorama, Pervasive, Peer1, Mosso, Akamai, Boomi, and all those guys. They're really looking to empower them to go out and deliver services.

What these companies are doing is allowing this broader feel, allowing this channel of service providers to exist, using their software and their services, and, in some cases, their actual data-center resources.

Gardner: I think you're saying that the organization that can provide the best ecology of partners and provide the best environment to thrive for many other players will do best, whereas, in the past, it seemed that, as an IT vendor, having the most installed base and the most lock-in offered the path to who did best.

Shimmin: Exactly.

Kobielus: I think you hit the nail on the head, Dana, when you pointed out that success in the emerging cloud arena depends on having a very broad and deep ecology of partners. I see the partner ecosystem as the new platform for cloud computing, being able to put together a group of partners that provide various differentiated features and services within an overall cloud-computing environment.

Then, the hub partner, as it were, provides some core, enabling infrastructure that binds them all together. Core infrastructures such as, for example, a core analytic environment or distributed data-warehousing environment that manages all of the structured, unstructured, and semi-structured data, manages all of the very compute-intensive analytical workloads, CPUs, and other resources that many or all of the partner solutions can tap into—a basic utility computing environment.

Shimmin: When you look at a company like Microsoft, they seem to be slow to market, and then, once they enter the market, they go really, really fast. They seem to be going really, really fast at the moment with two things, because they have both. They have the infrastructure and they also have the apps. They're going to have both paths.

They have the Azure platform, which is truly a PaaS offering that you use to build your own applications. So it's a layer above the Amazon EC2 infrastructure as a service.

Then they have the full-on SaaS-type products with Microsoft Online Services, which has in it almost the entirety of their collaboration software. So, they have actually sort of leapfrogged IBM Bluehouse a little bit with that.

The point is that these vendors are really looking at their portfolios and seeing which ones fit either of those two models. They're not committing to one or the other, Dana. They're really trying to tackle both ends [the infrastructure and the apps].

McKendrick: Just about every small ISV coming on the market now is offering a SaaS model. This is the way to go with the emerging smaller software-development companies.