Cloud computing definitely brings along with it concerns around security. There is no question about that. However, cloud computing is relatively very new and Amazon is on the forefront of this trend and as such, there are going to be some hiccups for the early adopters as this becomes more mature. That is not to say that cloud computing is not worth looking at. On the contrary, on my blog (http://sumanchaudhuri.wordpress.com), I have discussion on the merits and pitfalls of cloud computing, SaaS, etc. The point is that ISVs and enterprise customers can definitely benefit from the advantages that cloud computing brings to the table. That is not to say that cloud computing is some magic bullet that can withstand the punishment of bad architectures. You still need to have a deep understanding for architecting application for the cloud to be able to leverage the true benefits of cloud computing. That being said, to say that just because Amazon had some downtime that cloud computing is questionable is like saying that early SOA projects failed, so SOA is really not the way to go. Or for that matter that your data is that much safer in your own data center and will experience the same kinds of downtime scenarios.

At the end of the day, cloud computing is an emerging technology which brings with it its own set of benefits and challenges, but the fact remains that it is a disruptive technology (much like virtualization) and it will initially allow a lot of small and medium sized business to not have to deal with the mundane tasks that have no contributions to their core competency (which is building their product) without having to worry about procuring and provisioning servers, storage, etc. Does it have areas of concern – absolutely. But in my mind, as cloud computing gains more maturity and more attention, it will certainly solve some of these challenges and allow for it to become widely accepted, at which point, even large enterprises will start paying attention to it.