That's not the kind of environment in which most IT executives would try to implement a disaster recovery plan, outsource their data center and launch a customer relationship management project all at the same time, as Swartz did.

Swartz, who was hired less than a year ago as part of an expansion of Preferred Hotel's IT staff from one person to seven, actually went into the cloud investigation assuming the company would shift over to VMware virtualization environment but continue to use a co-location service to house the physical servers themselves. When it became clear how much lower the capital cost would be, at a similar ongoing monthly service charge, he was sold.

"With a colo, if something breaks you have to go there and fix it, or have someone send parts and wait until they get there. Meanwhile, everything is pretty much crippled," he says. "In a cloud environment, you have a facility manned 24 hours a day and virtual servers. So if a piece of hardware goes down, I'll never even know about it. [Terremark's] load-balancing takes care of it automatically and puts [the effected virtual server] onto another machine. From an operational perspective, the focus shifts away from maintaining the servers and onto doing other things."

The ability to focus on IT functions unique and specifically beneficial to your own business is one of the biggest strategic benefits of cloud computing, says , principal analyst at Forrester Research.

"The power of the cloud is that you're being offered these services by people who view data center operations as their business, not something they do as part of the rest of IT," Staten says. "They do it considerably better than you do because it's all they do."