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What Is Cloud Computing?


“Everything is going to be connected to cloud and data… All of this will be mediated by software.”

Satya Nadella, Microsoft CEO

Cloud Computing — On-Demand Computing Resources

You are probably here because you have heard the term cloud computing, or you may have heard the phrase “We’re moving our systems to the cloud” at work, and you would like to know what that means.

The following article will outline what cloud computing is and the advantages it brings for companies.


What is cloud computing?

Cloud computing is an on-demand service for computing resources. Providers over the Internet supply these on-demand computing resources.

To illustrate, let’s say that a company wants to store vast amounts of data. So it either can buy hardware and use that to store all the data it needs, or use a provider. In the latter example, the company would send data to the provider and retrieve it whenever required. Thus, data storage is a typical example of using a service of Cloud computing.

The types of cloud services provided over the Internet are usually data storage servers, databases, and network software. However, there are also many others.

We use the term “cloud” because it serves as an analogy for consuming such services outside local storage or hardware.

So essentially, cloud computing uses someone else’s infrastructure, data storage users, and network software, which means there is no longer a need to buy infrastructure.

Thus, when an IT manager declares that the company is moving to the cloud, the IT manager intends to use another company’s infrastructure, for example, their servers, based remotely.

Why would I want to use Cloud services?

network server room

The first and obvious advantage is clear, businesses can save money.

Providers offer services that allow users to store files and applications on remote servers and access data over the Internet, but at a far less cost than if a single company invested into that infrastructure by itself.

As illustrated, one of the services that such a provider offers is cloud-based storage, which makes it possible to store files in remote servers and retrieve them when needed. This is particularly advantageous to small businesses because they can keep information in the ‘cloud’ without buying or renting servers and hardware, which can be much more expensive.

Also, because the service is ‘on-demand, ‘ the business can utilise only what it needs. Before such services existed, companies were likely to overspend to buy enough resources to handle all their needs. Since setting up such resources can be expensive and maintaining such infrastructure can be just as costly.

The worst scenario for an IT manager is running out of resources that would cause a fatal crash by running out of memory or CPU. And so, IT managers would overcompensate with more resources than they thought they would need. Conversely, they would purposely underutilise resources to mitigate the risk of offline infrastructure due to a lack of computing resources required to run the applications, applications the business relied on to generate revenue. With on-demand resources available, this is no longer the case.

Confident manager.

Using cloud services allows businesses to use just what they need by utilising a shared pool of resources, limiting waste.

These are examples of the advantages of cloud computing, but there are more. In addition, the same benefits vary depending on the type of cloud service used.

One of the most major game changers in this area was Amazon Web Services (AWS) which offered resources to host websites and infrastructure as an on-demand service. This made running online businesses much more economical, especially for small and medium enterprises, as getting just the right equipment for a local infrastructure can be cumbersome.

Cloud computing services are also helpful for businesses that need to access large amounts of data through secure online network connections. The vast network access characteristic of cloud computing means that companies can implement and add services on various devices across the globe.

A further advantage is adding additional capabilities to a company’s environment as and when needed. Companies can add a plethora of services without expensive and time-consuming negotiation resulting in inflexible contracts. As the Internet has lowered the barrier to entry for such providers, providing such services increases the supply, driving the prices down further and without stringent contracts tying customers into their services for a long time. As a result, managers now have more choice to add IT services at a lower cost.

Business graphs paper and calculator on table

The halo benefit is that with such infrastructure being cheap, this also lowers the barrier to entry for any other business wishing to offer both B2B and B2C services to the end-user, allowing new companies and innovation to enter the market at an exponential rate.

On-demand computing enables companies to meet another challenge in the market, which is that of predictability. Companies not only have the issue of rightsizing their computing resources for the present but also need to figure out what they will likely need in the future, which is very difficult to do.

Cloud services enable cloud hosting companies to provide their customers with access to such resources only when needed. As a result, an IT manager no longer has to spend considerable time predicting or analysing what they may or may not need a year from now. Instead, they can utilise the scalability of cloud services and dial-up when the demand for their business warrants it.

Cloud applications allow scalability

Such on-demand computing services have also gone to considerable lengths to ensure that their services are as non-technical as possible and user-friendly. As a result, companies can also reduce the need for technical expertise to utilise such services and enable application support staff to manage more applications simultaneously.

Since the cloud computing model provides on-demand access to a shared pool of configurable computing resources, even small businesses can find they can take advantage of scaling infrastructure. In some cases, this can put them on the same competitive level as companies ten times the size. For smaller companies with limited budgets, there is no need to be concerned with creating a business case for investment to the board of directors and assessing the return on investment of physical hardware any longer. The IT department of the smallest software firm can dial up the services they need by logging into an account online.

This has undoubtedly changed the world we live in, as everything from file storage to application software can be delivered over the internet right to a device.

Ultimately, cloud services mean reducing costs and lowering the need for infrastructure investment, leading to an ability to invest in other projects that would give them a competitive advantage.

Cloud services can be both public and private

Molecular abstract network, dark background, 3d illustration

Public clouds are for general use

Public clouds range from access to a virtualised infrastructure that offers little more than raw computing power and storage infrastructure as a service (IaaS) to specialised software programs that can be easily implemented with Software as a Service (SaaS). Public clouds are a type of cloud computing. A cloud services provider provides computing resources, SaaS applications, individual virtual machines (VMs), bare metal computing hardware and complete enterprise-level infrastructure and development platforms over the public Internet. If you have ever used email, then you have taken advantage of a public cloud system.

If you have stored files or photos online using services such as Kwiqflick or Dropbox, then you have benefited from a public cloud application delivered over the Internet. Facebook, Google, Microsoft Office 365 Online are all examples of public cloud application delivery.

Private clouds are for single users or entities

A private cloud is a cloud environment or infrastructure dedicated to computing resources and access to only one customer or entity. Cloud computing differs from traditional IT, which provides services to consumers (consumers) and businesses (organisations and individual users) because companies and users do not have the infrastructure needed to support the programs and applications. A private cloud combines many of the advantages of cloud computing, including elasticity, scalability, easy service delivery, access control and resource security and on-site infrastructure adaptation.

Note that the private cloud environment may still be getting the resources for running this kind of set-up from third party providers in most cases. It just means that instead of the services being available to the public, it’s available only to the private party. However, remote cloud environments can be created and operated using the companies own infrastructure set up if it deems the investment worthwhile.

Cloud applications pushed the subscription model

Preparing average sales report

The infrastructure required to support the programs or applications that they use is owned and operated by third parties, and the end-user is responsible for the services they use. Cloud service providers usually use a paid billing model in which the service is delivered to the customer and calculated for the exact amount of computing resources used.

Cloud computing applications work on the same principle: They virtualise the computing power of servers with segmented, software-driven applications that offer processing and storage capabilities.

Several services have come into existence since cloud computing has enabled direct delivery over the Internet.

Different types of cloud service models

Software as a service (SAAS) is software delivered to the end-user via a subscription model. Instead of providing a single instance of the software for a single price, the supplier can charge a subscription where the end-user pays per month or year for the privilege to use.

Applications delivered through the cloud gave rise to the ‘freemium model’, the most prominent business model in software applications today. Freemium is providing the end-user with core functionality with the option to buy add-ons and additional features.

Function as a Service (FAAS) refers to cloud computing services to provide customers with a platform to develop, operate and manage applications.

Infrastructure-as-a-Service (IaaS) is a cloud service layer that enables an organisation to rent from a cloud provider its infrastructure (e.g. Servers, storage, networks, operating systems).

Mobile Backend Services (M-Model), also known as Backend Service (BAAS), are web apps and mobile apps that developers can use to connect their applications to other cloud services. Including cloud storage, cloud computing services and application programming interfaces (APIs) to display their applications using custom software development kits (SDKs).

The Future of Cloud computing

The network infrastructure technology only limits the future allows it to, which is rapidly improving all the time. Currently, 5G is sweeping across the world, allowing the transfer of data at vast speeds to enable users to take advantage of more complex applications that solve problems for everyday life.

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