Cloud Computing

Cloud computing or cloud services is a style of computing in which dynamically scalable and often virtualized resources are provided as a service over the Internet.

Examples of cloud computing include Google Apps which provide common business applications online that are accessed from a web browser, while the software and data are stored on the servers.

The term cloud is used as a metaphor for the Internet, based on how the Internet is depicted in computer network diagrams, and is an abstraction for the complex infrastructure it conceals. Users need not have knowledge of, expertise in, or control over the technology infrastructure "in the cloud" that supports them.

Architecture

The majority of cloud computing infrastructure as of 2009 consists of reliable services delivered through data centers and built on servers with different levels of virtualization technologies. The services are accessible anywhere that has access to networking infrastructure.

The Cloud appears as a single point of access for all the computing needs of consumers. Commercial offerings need to meet the quality of service requirements of customers and typically offer service level agreements. Open standards are critical to the growth of cloud computing and open source software has provided the foundation for many cloud computing implementations.

Characteristics

The customers engaging in cloud computing do not own the physical infrastructure serving as host to the software platform in question. Instead, they avoid capital expenditure by renting usage from a third-party provider. They consume resources as a service, paying instead for only the resources they use.

Many cloud-computing offerings have adopted the utility computing model, which is analogous to how traditional utilities like electricity are consumed, while others are billed on a subscription basis.

Economics

Cloud computing users can avoid capital expenditure (CapEx) on hardware, software and services, rather paying a provider only for what they use. Consumption is billed on a utility (e.g. resources consumed, like electricity) or subscription (e.g. time based, like a newspaper) basis with little or no upfront cost.

Other benefits of this time sharing style approach are low barriers to entry, shared infrastructure and costs, low management overhead and immediate access to a broad range of applications. Users can generally terminate the contract at any time (thereby avoiding return on investment risk and uncertainty) and the services are often covered by service level agreements with financial penalties.

Companies

Cloud Service Providers including IBM, Amazon, Google, Microsoft, Yahoo, and Level 3 Communications are the leaders in the cloud computing industry. It is being adopted by individual users through large enterprises including General Electric and Procter & Gamble.

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