But there’s no denying the attraction of services like Amazon Web Services or Joyent or Rackspace, where you can spin up and configure a new virtual machine within minutes of figuring out that you need it. So, many companies seek to approximate the experience they would get from a public cloud provider on their own internal infrastructure.

It turns out that a start-up I had never heard of before this week is the most widely deployed platform for running these “private clouds,” and it’s not a bad business. Eucalyptus Systems essentially enables the same functionality on your own servers that you would expect from a cloud provider.

Eucalyptus said today that it has raised a $30 million Series C round of venture capital funding led by Institutional Venture Partners. Steve Harrick, general partner at IVP, will join the Eucalyptus board. Existing investors, including Benchmark Capital, BV Capital and New Enterprise Associates, are also in on the round. The funding brings Eucalyptus’ total capital raised to north of $50 million.

The company has an impressive roster of customers: Sony, Intercontinental Hotels, Raytheon, and the athletic-apparel group Puma. There are also several government customers, including the U.S. Food and Drug Administration, NASA, the U.S. Department of Agriculture and the Department of Defense.

In March, Eucalyptus signed a deal with Amazon to allow customers of both to migrate their workloads between the private and public environments. The point here is to give companies the flexibility they need to run their computing workloads in a mixed environment, or move them back and forth as needed. They could also operate them in tandem.

Key to this is a provision of the deal with Amazon that gives Eucalyptus access to Amazon’s APIs. What that means is that you can run processes on your own servers that are fully compatible with Amazon’s Simple Storage Service (S3), or its Elastic Compute cloud, known as EC2. “We’ve removed all the hurdles that might have been in the way of moving workloads,” Eucalyptus CEO Marten Mickos told me. The company has similar deals in place with Wipro Infotech in India and CETC32 in China.

The largest Indian tech firms, including Tata Consultancy Services Ltd. (TCS.NS), Infosys Technologies Ltd. (INFY) and Wipro Ltd. (WIT), all reported strong financial results in recent weeks, benefiting from a global uptick in spending on technology services by businesses such as banks and insurance companies and renewed interest in outsourcing as a cost-cutting measure.

The turn of events marks a reversal from a year ago, when Indian firms were reeling from a steep drop in orders for software services. But the tech-services sector differs now from the Indian firms’ boom years of 2003 to 2007, and new hurdles have arisen.

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Caso says the group is likely to take another leg down, forecasting that April conference call season will see most of the companies issue guidance below Street expectations. He writes that “demand remains lackluster and decision-making slow.” Customers budgets are down 10-20 percent this year, he contends, but with many operating on a month-to-month basis and focused solely on cutting costs. Caso writes that he is hearing pricing has come down close to 10 percent, and that existing contracts are being repriced. He also says the sector is seeing increasing competition for deals from Accenture (ACN) and IBM (IBM).

Caso cut his ratings today on Cognizant (CTSH), Wipro (WIT), Infosys (INFY) and Syntel (SYNT) to Underperform from Market Perform. He also reduced EPS estimates for all four companies. Caso said the stocks could see another 15-30 percent decline from Friday’s close.

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Vydianathan offered six factors affecting her revised view of the sector:

• “Uncertainty” in the banking and financial services industry.
• Potential slowdown in Europe and in other industries.
• Poor visibility for demand.

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