The virtualization world is going nuts talking about cloud computing and how it is going to destroy the datacenter. The possibilities are intriguing but I'm pretty sure that it could easily be a decade before people think of the cloud the same way that they look at virtualization in genenral.
I just came across this scream stream at FierceCIO.com simply mentioning the possiblity and with nothing to truly back it other than a slightly obscure report from UC Berkeley. This is certainly premature and I seriously doubt that too many CIOs and CTOs are going to ever feel very comfortable handing their datacenter over to a 3rd party regardless of the cost savings. I'm still waiting to see the Fax machine and paper disappear from the corporate world. We will continue to hold onto corporate datacenters for the same reasons. On the same note, even in the cloud your servers will be in a datacenter... Just someone else's. Read the article and my response below.
I'd say it is premature to say that the cloud is going to kill the datacenter. What I expect we will see are some organizations taking advantage of this, primarily those who need space and have already consolidated into a virtual (VMware) environment. The cloud services as mentioned here would then allow them to upload their existing application servers that they feel comfortable with having offsite, and comfortable meeting SLAs. The corporate datacenter will go away about the same time that fax machines and paper will go away. People like things that they can touch. It makes these things more tangible and comforting when you can open the door and see the lights and hear the fans. Semantics can come to play and we can say that having servers off-site isn't part of the "traditional" datacenter, but let's check back in 3-5 years and see where this has gone. My bet is that the cloud will be used like storage rental facilities; great for when you're moving or you just need a little extra space.