Declaration; I am with CohesiveFT the company mentioned in Steven's post above. We have web based a platform (www.elasticserver.com) that allows you to turn software into virtual appliances and publish them to clouds and virtual environments with a few clicks.

I think Dan and Subba must be talking about the 'Cloud' in its broadest sense including SaaS, Google Docs, Google Mail, etc., and I agree SaaS services don't need virtualization. However, if you are talking about the cloud as a venue where people run their own apps then virtualization is key.

We think of the cloud as being multiple venues where you can easily sign-up, use as much compute resource as you want when you want and only pay for what you use. Using clouds should be a retail experience, direct sales cycle involving a negotiation and long legal agreement. Cloud computing is about flexibility and lower total cost of ownership. Jeff Barr of Amazon Web Services and the guys at the 451Group have coined the terms "Cloudbursting" where you spill over from your currently available computing resource into a public cloud. This provides you with the excess capacity you need without capital outlay on kit that will not be needed next week.

Cloud scenarios such as these do, as Charles Kinnan notes, need virtualization. The dominant cloud venue today is Amazons' EC2, requires virtualization their AMIs (Amazon Machine Images) are a variant of Xen the open source VM format. To use these cloud venues in this flexible manner you need an 'on-ramp' to the clouds, one that automatically configures your application for you target cloud venue, and which allows you to very easily reconfigure the same app for a different cloud venue, or for your own data center - private cloud. Our dynamic assembly platform allows you to very quickly and easily assemble, configure, deploy and manage your application stack with your business logic. Allowing you to capture the knowledge, share it, and repeat with speed and quality.

Cloud computing is still not an obvious choice for many. To gain flexibility and lower TCO, businesses will not want to forgo security, management, portability, and data location choice and control. Elastic Server today gives you portability and allows you to manage you applications running inside the VM 'black box' and in the very near future we will announce more that make clouds enterprise ready. Watch www.cohesiveft.com for more news.