As Michael Phelps and other members of Team USA look to make history at the Olympics this week, the U.S. Olympic Committee expects fans to mob its Web site, seeking news and video from Beijing. To ensure that there are no glitches, the site is using AT&T 's new utility computing service to provide temporary Web server capacity.

As the latest entrant into cloud computing, AT&T is aiming its managed computing, networking, security, and storage service at big companies. By positioning the service as part of its established hosting offerings, AT&T is trying to reassure companies that are still hesitant to take the leap to cloud computing.

AT&T's largest U.S. competitor, Verizon, last month outlined an offering code-named Computing as a Service, due next year, that will compete for many of the same customers.

AT&T's service--which it's calling Synaptic Hosting--will let companies host Windows Server, Linux server, and Web applications in AT&T's data centers. AT&T will handle the licensing and installation of the operating systems as well as database software required to run an application. It also will manage the reliability and security of the underlying infrastructure and, for an extra fee, the applications that customers run.

The environment can handle 80% of common applications, including the LAMP open source stack, most Web applications, and Oracle and SAP apps, says Jim Paterson, AT&T's VP of product development for hosting and application services. Verizon's service will rely on a similar Windows- and Linux-based infrastructure. For now, Solaris and AIX customers will be shut out.

AT&T expects prime candidates for Synaptic Hosting to be companies whose IT needs are seasonal or unpredictable, such as retailers looking to ramp up Web sites for Christmas and employers whose servers are pushed to the limit during benefit plan open enrollment periods. "Anybody that has any type of dynamic need in their environment," Paterson says.

UTILITY COMPUTING'S PLAYERS

Besides their experience in managed services, phone companies have the extensive data center facilities needed to provide utility computing services. It's a small market today, led by Amazon and a few smaller vendors that initially targeted small companies, such as Web startups. But Microsoft and Google are moving in, spending billions on new data centers. And while AT&T may be very experienced in managed network services, it lags behind companies like Terremark and Savvis in providing IT infrastructure as a service. AT&T's services are likely to be considerably different from those offered by Amazon, Google, and Microsoft, which provide or are likely to provide open APIs for provisioning new resources and to let companies quickly scale up and down. AT&T doesn't have that same experience with APIs. As for scaling, AT&T requires companies to contract for set resources, then ramp from there.

Synaptic Hosting uses the same management portal as AT&T's managed hosting environment to let customers monitor and change their remote infrastructures. Customers can choose AT&T's multitenant virtual infrastructure or pay for dedicated hardware. Both approaches let customers tap in on a utility basis, meaning they don't have to predict their capacity need and pay for it beforehand, as is required by most managed hosting options.

Instead, both Verizon and AT&T charge based on the capacity and level of service used. AT&T customers will pay based on the average peak utilization of CPU and memory during a month, and the service level and data protection required. Verizon hasn't detailed its pricing.

Both AT&T and Verizon say they expect to expand the scope and scale of their utility computing offerings, though neither has said what specific services are likely to follow. That may be for the customers to decide, if and when they sign on.