Cloud computing is a technology that uses the internet and central remote servers to maintain data and applications.

Cloud computing allows consumers and businesses to use applications with out installation and access their personal files at any computer with internet access.This technology allows for much more efficient computing by centralizing storage, memory, processing and bandwidth.
A simple example of cloud computing is Yahoo email or Gmail etc. You dont need a software or a server to use them. All a consumer would need is just an internet connection and you can start sending emails. The server and email management software is all on the cloud ( internet) and is totally managed by the cloud service provider Yahoo , Google etc. The consumer gets to use the software alone and enjoy the benefits. The analogy is , 'If you only need milk , would you buy a cow ?' All the users or consumers need is to get the benefits of using the software or hardware of the computer like sending emails etc. Just to get this benefit (milk) why should a consumer buy a (cow) software CLOUD COMPUTING SEGMENTS APPLICATIONS On Demand software services come in a few different varieties which vary in their pricing scheme and how the software is delivered to the end users. In the past, the end-user would generally purchase a servers and is accessed by the end user over the internet. While this is the most common platform for On Demand software services, there are also some slightly different offerings which can be described as a hybrid of these two platforms. For instance, a program through which the end user pays a license fee, but then accesses the software over the internet from centralized servers is considered a hybrid service. Who is Offering On Demand Software? - The companies below are

already established in the On-Demand software or SaaS business. These companies charge their customers a subscription fee and in return host software on central servers that are accessed by the end user via the internet. Salesforce.com (CRM) Google (GOOG) NetSuite (N)

Cordys Taleo (TLEO) Concur Technologies (CNQR) Info Technologies (IT) canadasoftware.net (nexgen)

Who is Offering Traditional Software? - The following companies have

established themselves as traditional software providers. These companies sell licenses to their users, who then run the software from on premise servers. Platforms: Many of the companies that started out providing On Demand application services have developed platform services as well. The platform segment of cloud computing refers to products that are used to deploy internet. NetSuite, Amazon, Google, and Microsoft have also developed platforms that allow users to access applications from centralized servers. In July 2008, HP, Yahoo! (YHOO), and Intel (INTC) announced a joint cloud computing research project called the Cloud Computing Test Bed. The companies are jointly designing and producing the internet based testing utilizing HP hardware and Intel processors.[3] Active platforms - The following companies are some that have developed SAP AG (SAP) Oracle (ORCL) Blackbaud (BLKB) Lawson Software (LWSN) Blackboard (BBBB)

platforms that allow end users to access applications from centralized servers using the internet. Next to each company is the name of their platform. Google (GOOG) - Apps Engine Amazon.com (AMZN) - EC2 Microsoft (MSFT) - Windows Live SAVVIS (SVVS) - Symphony VPDC Terremark Worldwide (TMRK) - The Enterprise Cloud Salesforce.com (CRM) - Force.com

Infrastructure: The final segment in cloud computing, known as the infrastructure, is very much the backbone of the entire concept. Infrastructure vendors environments (such as Google gears) that allow users to build applications. Cloud storage, such as Amazon's S3, is also considered to be part of the infrastructure segment. Major Infrastructure Vendors - Below are companies that provide

infrastructure services: Google (GOOG) - Managed hosting, development environment International Business Machines (IBM) - Managed hosting SAVVIS (SVVS) - Managed hosting & cloud computing Terremark Worldwide (TMRK) - Managed hosting Amazon.com (AMZN) - Cloud storage Rackspace Hosting (RAX) - Managed hosting & cloud computing

Cloud Computing makes computer infrastructure and services available "on-need" basis. The computing infrastructure could include hard disk, development platform, database, computing power or complete software applications. To access these resources from the cloud vendors, organizations do not need to make any large scale capital expenditures. Organization need to "pay per use" i.e. organization need to pay only as much for the computing infrastructure as they use. The billing model of cloud computing is similar to the electricity payment that we do on the basis of usage. In the description below vendor is used for cloud computing service provide and organization is used for user of cloud computing services. Cloud Computing has the following characteristics:

A.

Availability of large computing infrastructure on need basis: Cloud vendors provide appearance of infinite computing infrastructure availability. This is available to organizations on need basis. This ensures that organizations do not need to set up servers for their peak requirements. As an example consider the official Wimbledon site. The site gets extremely high traffic in the two weeks when the championship happens. For this two weeks period this site will have high server usage. For rest of the year the site will need to only pay for the reduced usage. In general organizations do not need to bear the cost of computing infrastructure for their peak loads. The usage of computing resources can be increased or reduced on need basis, is called elastic computing. Cloud computing uses a "pay-per-use" billing model. Cloud billing model are very different when compared to traditional IT billing techniques. Typical billing models include per user billing, per GB billing or per-use billing (i.e. an organization is billed on each usage of the computing service). Cloud computing typically does not involve long-term commitment to use the computing infrastructure. The vendor does not enforce long-term usage of services. Cloud computing does not involve any significant capital expenditure for the organization. Unlike traditional IT infrastructure, in cloud computing organizations just use the computing services without procuring it. In some sense cloud computing involves renting the computing resources instead of buying them. As the figure below displays, unlike traditional computing model, Cloud computing requires no capital expenditure to acquire initial computing resources. The figure below is from cloud computing wiki

B.

C.

D.

E. F.

Since the cloud computing vendor provides services over the web, these are available from any location. Cloud computing can be ordered online without detailed formal contracts.

Cloud computing provides a level-playing field for smaller organizations. It allows smaller organization access to computing infrastructure without making any significant initial investment. Many experts believe that cloud computing will lead to increased commoditization of computing resources.

Origin of term
Cloud traditionally depicts the internet. Since cloud computing is built using internet, hence the name.

Examples of Cloud Computing applications

Hotmail.com was launched in 1996, It is widely considered as the first cloud computing application. The
data is stored at the vendor servers, and users could pay incrementally to increase disk space usage. Many other services have emerged in the last decade that allows users to store information (or perform processing) without paying any upfront charges. These are typically consumer oriented services. Twitter, myspace, Wikipedia, youtube, facebook, linkedin, Google docs and blogger all have the characteristics explained above and are examples of cloud computing. Salesforce.com, founded in 1999, was the first successful example of providing software as a service in the business to business domain. Salesforce is a CRM tool for sales executives providing features like managing customer details, running promotions etc. Google and Microsoft provide development platforms that can be accessed with "pay-per-use" billing model. All these services are examples of Cloud computing. Amazon.com was one of the first vendors