As consumers increasingly carry multiple computing devices (smartphones, tablets, laptops, etc.), it looks like 2011 will be the year that so-called cloud (Web-based) computing will finally become big business.
As The New York Times noted last Friday, businesses have been slow in adopting cloud computing for data storage. Dell (NASDAQ:DELL), IBM (NYSE:IBM), and others are now all investing heavily to create data centers for new cloud storage.
Retailers like Amazon (NASDAQ:AMZN) are starting to offer cloud storage for media sales, slowly changing the face of its most basic business model of selling permanent goods.
Here are three stocks investors should pay close attention to as they debut their own cloud services in the coming months.
H-P is banking on a new operating system to secure its place in all corners of the changing tech industry. It will be the foundation on which the TouchPad tablet will distinguish itself from the iPad and it will likely be the core of future models of the Pre and Veer smartphones. CEO Leo Apotheker hasn’t provided all the details but he has committed to cloud services being core to the WebOS experience. If H-P can woo consumers with its tablets and smartphones by offering free cloud storage for media like music and ebooks as well as Office documents, it could create a scenario where its proprietary tools are a compelling alternative to Microsoft’s (NASDAQ:MSFT) Azure cloud Office-software, as well as an operating system alternative to Google’s (NASDAQ:GOOG) Android.
Sony enjoyed a decade of dominance in the home video game hardware business with its Playstation machines, but even as the video game industry has grown, Sony’s star has fallen. Apple’s handhelds, Nintendo’s (PINK:NTDOY) Wii, and several other devices have made the industry that Sony took over in the early 2000s unrecognizable. Cloud computing, however, may prove to be the heart of the company’s new business model. Sony began offering Playstation 3 users the ability to game data (profile information, save states, etc) in the cloud earlier this year. Rumors suggest that this is the first phase of a business model that will come to fruition when the company releases its new NGP portable game system this holiday season. Rather than simply release software on either the home or portable system, Sony will release games that users can access on both platforms via cloud data centers. If nothing else, it will diversify the company’s offerings from both home competitors (Microsoft) and portable (Apple.)
Apple has been especially enigmatic about its cloud services. Make no mistake, the company is working on them, it’s just unclear what they are and when they will be available. Apple is expected to deliver a cloud-based version of its iTunes service, letting users store music in a “virtual locker,” as it’s been described in other reports. The Wall Street Journal also suggested in a February report that a new iPhone model will be released this fall alongside a revamp of its MobileMe office-and-organizational-tools service that offers cloud storage. The only problem with both of these businesses is that competitors (Amazon in entertainment, Microsoft and likely HP in office tools) have beaten Apple to the punch. But hat’s never been too much of a problem for Apple before.