Yesterday, I started a series of posts about how the move to cloud computing is affecting competition.  The second question I posed was how cloud computing changes the boundary between “infrastructure” and “applications”?

At the most basic level I believe that some things that were standalone applications will become features that are provided by the cloud.  We have seen this play out with content.  Essentially, the web to date has been “content in the cloud.” And one of the most important developments has been the syndication of content.  Weather is a great example.  Sure, occasionally I still go to weather.com but more likely I am seeing the weather on a widget inside another page or on my desktop. 

Cloud computing is doing the same for “functionality in the cloud.” Take backup for example. Most of us now run backup applications for our laptop computers – as more of the data is stored in the cloud, backup as a separate standalone application will gradually disappear.  But what about applications that are already web delivered, such as blogging platforms?  Much of the application code inside of today’s blogging platforms is likely to be provided by the cloud (storing posts, providing RSS feeds, etc.) That raises hard questions about what it means to be a blogging platform and how to differentiate yourself from others.  Until recently, one of the benefits of wordpress.com was that you did not have to deal with installing the wordpress code at a hosting company (and paying for hosting).  But with Google AppEngine and similar offerings those hurdles will essentially disappear.

So to answer the original question, with cloud computing, the boundary between “infrastructure” and “applications” will shift squeezing the room for applications and absorbing more into the infrastructure.