The only constant is change.
A headline like "Will the cloud be the end of the IT department?" is simply to get your attention.
A lot of things change, but the need for someone local to do the hand holding and end user support is one constant that hasn't changed. The nebulous cloud does not take care of the local issues.
How do you get to the cloud? Who builds and manages the network that gets you to the cloud?
What devices get you to the cloud? Who sets up, updates, maintains, the workstations and other devices at the local level?
What makes me laugh about all the new talk about the cloud is that the concept of hosted applications has been around since the early days of computing and the same questions have been raised for years.
Likewise the debate of moving to the cloud sounds like an old discussion revisited. A similar debate over the model of centralized computing versus decentralized computing has been going on longer since before some of you were born.
The roles of the IT department members will continue to change, but the need for a local IT department will still exist.