Computing giant IBM this week announced a cloud-based testing and development environment, which will allow customers to rent virtual systems on which to test software they have developed.

The company has surprised some commentators with the decision to base the system on virtualisation software from enterprise open source vendor Red Hat, rather than the more commonly used Xen open source hypervisor.

The commercial offering, which will be launched later this year, is analogous to a test and ‘dev’ cloud that IBM built for its own internal purposes. Speaking at Information Age’s Business Applications & Infrastructure event in 2009, the company’s worldwide global test cloud executive Walter Falk explained the advantages. “We’ve seen a return on investment (ROI) of over 1,000%,” he said. “It paid for itself in under 6 weeks.”

Cloud computing, like virtualisation and open source operating systems before it, is commonly used for software testing and development, as it reduces the requirement for capital investment in non-production systems. IBM may be especially well placed to exploit the opportunity, as unlike other popular cloud providers it also sells software development tools.