News tip: Our education team has just released a free, self-paced course on SmartCloud Notes in a hybrid environment. (The course link was originally posted in the blog Apr 26th 2011. I have updated it on May 21st 2013 after a reader notified me it was broken. The change is a result of the rebranding from LotusLive to SmartCloud).
A hybrid environment allows integration between your on-premises Domino systems and the cloud. Replicating your Domino Directory to the cloud provides for a seamless integration between environments. So rather than replacing existing Domino infrastructure with cloud based offerings, you can leverage the cloud based offerings as an extension of your existing on-premises environment. Your Domino administrators continue to administer on-premises Domino servers and applications, while IBM administers and maintains the SmartCloud Notes mail servers in the cloud.