Cloud computing is the on-demand availability of computer system resources, especially data storage (cloud storage) and computing power, without direct active management by the user. Large clouds often have functions distributed over multiple locations, each of which is a data center. Cloud computing relies on the sharing of resources to achieve coherence and typically uses a “pay as you go” model, which can help in reducing capital expenses but may also lead to unexpected operating expenses for users.
Rather than owning their own computing infrastructure or data centers, companies can rent access to anything from applications to storage from a cloud service provider.
One benefit of using cloud-computing services is that firms can avoid the upfront cost and complexity of owning and maintaining their IT infrastructure, and instead simply pay for what they use, when they use it.
In turn, providers of cloud-computing services can benefit from significant economies of scale by delivering the same services to a wide range of customers.
Cloud computing underpins a vast number of services. That includes consumer services like Gmail or the cloud backup of the photos on your smartphone, though to the services that allow large enterprises to host all their data and run all of their applications in the cloud. For example, Netflix relies on cloud-computing services to run its video-streaming service and its other business systems, too.
Cloud computing is becoming the default option for many apps: software vendors are increasingly offering their applications as services over the internet rather than standalone products as they try to switch to a subscription model. However, there are potential downsides to cloud computing, in that it can also introduce new costs and new risks for companies using it.
A fundamental concept behind cloud computing is that the location of the service, and many of the details such as the hardware or operating system on which it is running, are largely irrelevant to the user. It’s with this in mind that the metaphor of the cloud was borrowed from old telecoms network schematics, in which the public telephone network (and later the internet) was often represented as a cloud to denote that the location didn’t matter — it was just a cloud of stuff. This is an over-simplification of course; for many customers, the location of their services and data remains a key issue.
