Cisco Systems won't try to compete with pay-as-you-go cloud computing providers such as Amazon, and instead will sell its infrastructure to those companies and provide its own software as a service.

The company sees virtualization as the next major computing model and its own Unified Computing System as the first step toward a fully virtualized data center, Chief Technology Officer Padmasree Warrior said in a briefing Monday during the Cisco Live user conference in San Francisco. The company's presence in both enterprise and service provider networks makes it the ideal partner for companies adopting cloud computing, because they want to gain cloud benefits such as scalability and disaster recovery without pushing out control of all their infrastructure, she said.

Cisco is positioning itself in the cloud world as all major vendors find their places there. Warrior said her company's approach differs from those of rivals Hewlett-Packard and IBM because those vendors are moving into the sale of cloud computing resources. Cisco doesn't see a big enough opportunity in that business, she said.

There are four layers in cloud computing, Warrior said: software as a service (SaaS), development platforms as a service, capacity as a service, and the underlying infrastructure for providing those services. Cisco already provides software as a service, in the form of its WebEx collaboration and IronPort security products. Its WebEx Connect offering for third-party application development is a platform as a service. Cisco will leave the business of selling raw capacity to others, while supplying the infrastructure for those kinds of companies, Warrior said.

With Cisco-based cloud infrastructures available for hire, enterprises will be able to hold on to some of their own resources while tapping into public clouds and smoothly moving data, applications and computing workloads between the two, according to Warrior. Cisco's Unified Computing System, which combines the company's new blade server platforms with networking and storage elements, is a step toward that capability, she said. It's a pre-integrated architecture that removes the burden of manual integration from the enterprise IT department, according to Cisco. The company has already sold UCS to some customers, Warrior said.

Cisco doesn't intend to have a completely closed system between enterprise and cloud-provider networks, she added. Where the infrastructure on one end isn't Cisco's, the company's goal is to work with other vendors' systems, she said.

The company also gave an update on its WebEx SaaS collaboration product. Cisco is updating the WebEx interface to appeal to "Main Street" users in addition to the "early adopters" who have made up much of its user base, said Doug Dennerline, senior vice president of Cisco's Collaboration Software Group.

The software will be oriented less toward virtual meeting spaces and more toward individuals whom a user collaborates with, he said. For example, users will be able to click on a contact's name in an instant-messaging buddy list and see a history of interaction between the user and that person, such as what meetings they have both attended. If any of those meetings were recorded, links to those recordings would also pop up.

Cisco is also using its acquisition of PostPath last year to create a cloud-based e-mail system integrated with the presence technology it acquired from Jabber, Dennerline said. And its move to bring smartphone users into WebEx is continuing, with more than 150,000 downloads so far of the WebEx application for the iPhone, he said. Cisco is also talking with Research In Motion, Nokia and Samsung about smartphone clients, he added.

Cloud computing is critical for collaboration because the next wave of productivity gains will come from inter-company collaboration, Warrior said.

There is a trend toward richer collaboration between companies, where so far most tools for interaction have been within organizations, said IDC analyst Abner Germanow, who attended the briefing. This is where Cisco has an edge over its competitors, namely Microsoft and IBM, which have dominated intra-company collaboration, he said. The faster that enterprises move in this direction, the better for Cisco, Germanow said, because its rivals are trying to catch up. However, the trend is likely to take two to five years to play out, he said.