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What is Cloud Computing Everything You Need To Know


Completely revised and updated overview of cloud computing, starting with the fundamentals and progressing through IaaS and PaaS, hybrid, public, and private clouds, as well as AWS and Azure.

What is cloud computing, in simple terms?

The distribution of computing services, such as servers, storage, databases, networking, software, analytics, and intelligence, via the Internet (also known as “the cloud”) in order to provide more rapid innovation, flexible resources, and economies of scale is referred to as “cloud computing.”

How does cloud computing work?

Firms may rent access to everything from apps to storage from a cloud service provider rather than purchasing their own computer equipment or data centres. This allows the companies to save money.

One of the advantages of using cloud-computing services is that businesses are able to avoid the upfront costs and complexity of owning and maintaining their own IT infrastructure. Instead, they can just pay for what they need, when they use it, which is a significant benefit.

As a result, companies who provide cloud computing services are able to reap the benefits of enormous economies of scale when they supply the same services to a large number of different clients.

What cloud-computing services are available?

The services provided by cloud computing now encompass a tremendously extensive variety of applications and features, ranging from the most fundamental functions of storage, networking, and processing power all the way up to natural language processing, artificial intelligence, and the most common office software programmes. Even quantum computing can now be done over the cloud, which opens up a whole new world of possibilities for services that previously required users to be in close proximity to the computer gear they were operating.

What are examples of cloud computing?

A plethora of different services are supported by cloud computing. This includes consumer services such as Gmail or the cloud backup of the photos on your smartphone, as well as services that allow large businesses to host all of their data and run all of their applications in the cloud. Examples of the latter include Amazon Web Services, Microsoft Azure, and Google Cloud Platform. For instance, the operation of Netflix’s video streaming service as well as its other business operations is entirely dependent on the company’s use of cloud computing.

Computing in the cloud is quickly becoming the default choice for many applications. Software providers are increasingly delivering their programmes as services through the internet rather than as separate products as they aim to move to a subscription form of business. However, there is the possibility of cloud computing introducing new expenses and new hazards to businesses that use it. This is one of the major drawbacks of cloud computing.

Why is it called cloud computing?

The location of the service, as well as many of the specifics, such as the hardware or operating system on which it is running, are essentially irrelevant to the user in cloud computing, which is one of the most basic ideas behind this kind of computing. 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 – provided the inspiration for the metaphor of the cloud. This was done with the idea that the cloud didn’t care where it was located; it was just a cloud of stuff. Obviously, this is an oversimplification of the situation; for the majority of consumers, the location of their services and data is still the most important concern.

What is the history of cloud computing?

The term “cloud computing” has been in use since the early 2000s, but the idea of “computing as a service” has been around for a significantly longer period of time. The idea of “computing as a service” dates all the way back to the 1960s, when computer bureaus began allowing businesses to rent time on a mainframe rather than having to buy one for themselves.

The emergence of the personal computer (PC), which made owning a computer much more cheap, and subsequently the rise of corporate data centres, where firms would store massive quantities of data, mainly rendered these “time-sharing” services obsolete and caused them to fall into disuse.


However, the idea of renting access to computer power has reemerged on several occasions, most notably in the application service providers, utility computing, and grid computing that were prevalent in the late 1990s and early 2000s. After this came cloud computing, which exploded onto the scene with the advent of software as a service and hyperscale cloud-computing companies like Amazon Web Services.

How important is the cloud?

The name “cloud computing” has been in use since the early 2000s, but the idea of “computing as a service” dates back much, much farther, to the 1960s. At that time, computer bureaus would let businesses to rent time on a mainframe rather of having to purchase one for themselves.

The emergence of the personal computer (PC), which made owning a computer far more cheap, and then, in turn, the growth of corporate data centres, where firms would store enormous quantities of data, mainly supplanted these ‘time-sharing’ services.


However, the idea of renting access to computing power has emerged many times between the late 1990s and the beginning of the 2000s in the form of application service providers, utility computing, and grid computing. This was then followed by cloud computing, which truly gained traction with the advent of software as a service and hyperscale cloud-computing companies such as Amazon Web Services.

This change didn’t start picking up steam until the years 2020 and 2021, when companies started speeding up their plans for digital transformation in response to the epidemic. The widespread lockdowns that occurred during the epidemic made it very clear to businesses how vital it was for their employees to be able to access their computer infrastructure, apps, and data from any location, and not just from the office.

According to Gartner, the continuous migration to the cloud will be driven by an increased need for integration capabilities, agile work processes, and composable design.

The amount of money spent on cloud computing keeps going up. IDC, a technology analysis firm, forecasts that expenditure on cloud infrastructure will have increased by 8.3 percent compared to 2020, reaching $71.8 billion, while spending on non-cloud infrastructure is projected to increase by just 1.9 percent, reaching $58.4 billion. Long term, the analyst anticipates that spending on compute and storage cloud infrastructure will experience a compound annual growth rate of 12.4 percent over the period of 2020-2025, reaching $118.8 billion in 2025, and it will account for 67.0 percent of total spending on compute and storage infrastructure. In contrast, spending on infrastructure that is not cloud-based will remain reasonably stable and reach 58.6 billion dollars in 2025.

Even though some of the specifics about cloud computing investment have been predicted to change, all projections are moving in the same general direction. They are referring to the same kind of motion when they say this: According to research from the technology analysis firm Canalys, global spending on cloud infrastructure services in the fourth quarter of 2021 surpassed $50 billion for the first time ever in a single quarter. Spending on cloud infrastructure services is projected to increase by 35 percent to a total of $191.7 billion for the whole year.

According to Canalys, there is already a new growth potential for the cloud on the horizon, and this possibility comes in the shape of augmented and virtual reality, as well as the metaverse. “Over the course of the next ten years, this will be a major factor in determining spending on cloud services as well as infrastructure investment. The metaverse will, in many respects, be analogous to the internet as we know it now, although with expanded capabilities and an increased need for computing power “according to the expert.

What are the core elements of cloud computing?

The concept of cloud computing may be split down into a number of distinct component aspects, each of which focuses on a particular portion of the technological stack or a unique set of use cases. Let’s take a look at a few of the most well-known in a little bit more depth, shall we?

What is Infrastructure as a Service?

The term “Infrastructure as a Service,” or IaaS, refers to the basic building blocks of computing that may be hired. These building blocks include storage, networking, and real or virtual servers. This is attractive to businesses that want to build applications from the ground up and want to control nearly all the elements themselves; however, it does require businesses to have the technical skills to be able to orchestrate services at that level. This is attractive to businesses that want to build applications from the very ground up and want to control nearly all the elements themselves.

What is Platform as a Service?

Platform as a Service (PaaS) is the next layer up; in addition to the underlying storage, networking, and virtual servers, this layer also includes the tools and software that developers need to build applications on top of it. These tools and software might include middleware, database management, operating systems, and development tools. Platform as a Service (PaaS) is the next layer up.

What is Software as a Service?

The distribution of programmes in the form of a service is known as software as a service (SaaS), and it is likely the kind of cloud computing that the majority of people are used to using on a day-to-day basis. Because the end user will access the service via either a web browser or an application, the underlying hardware and operating system are irrelevant to them. The service is often purchased on a per-seat or per-user basis.

The majority of money spent on the cloud is allocated to software as a service (SaaS) due to the vast array of apps that can be accessed via SaaS. These applications range from customer relationship management systems like Salesforce to office suites like Microsoft’s Office 365. IaaS and PaaS are the segments of the market that have consistently grown at much faster rates, according to analyst IDC: “This highlights the increasing reliance of enterprises on a cloud foundation built on cloud infrastructure, software-defined data, compute and governance solutions as a Service, and cloud-native platforms for application deployment for enterprise IT internal applications.” Even though the entire market is expanding at a rapid pace, the IaaS and PaaS segments are the ones that have consistently grown at much faster rates. According to IDC’s forecasts, infrastructure as a service (IaaS) and platform as a service (PaaS) will continue to expand at a faster pace than the entire market for cloud computing “as resilience, flexibility, and agility influence IT platform choices.”

What is multi-cloud computing?

Although the major cloud service providers would be delighted to fulfil all of their corporate clients’ computing requirements, a growing number of companies are searching for ways to distribute the workload across a number of different providers. The result of all of this is the advent of multi-cloud computing. This strategy has multiple goals, one of which is to ensure that the organisation does not become dependent on a single provider, which can result in the kind of high costs and lack of adaptability that the cloud is frequently marketed as being able to circumvent. Another objective of this strategy is to identify the optimal combination of technologies used throughout the sector.

This implies that being able to connect and integrate cloud services from many providers is going to be a new problem that will become more difficult for businesses. There is a dearth of employees who are knowledgeable about numerous clouds, which is one of the issues, as well as disparities in process that exist across cloud systems. Customers will also want to be able to manage all of their different cloud infrastructure from a single location, have it be simple to build applications and services and then move them, and ensure that security tools can work across multiple clouds. None of these things is particularly simple at the moment, but customers will want them in the future.

What are the benefits of cloud computing?

The precise advantages may vary depending on the sort of cloud service that is utilised, but employing cloud services generally means that businesses do not need to acquire or maintain their own computer equipment. This frees up capital and reduces operational costs.

Because the provider handles everything, you won’t have to worry about purchasing servers, keeping applications or operating systems up to date, decommissioning and disposing of hardware or software when it becomes obsolete. All of these tasks are handled for you. Rather of relying on the capabilities available inside an organisation, it may make more sense to migrate to a cloud provider for services that are considered to be standard, such as email. Because a firm that specialises in operating and protecting these services is likely to have employees with greater abilities and more expertise than a small business could afford to recruit, cloud services may be able to provide end users with a service that is both more secure and more efficient.

Because organisations simply pay for the resources they use when they utilise cloud services, this allows them to move more quickly on initiatives and try out ideas without the need for drawn-out procurement processes or significant upfront expenses. Advocates of cloud computing often point to the idea of increased business agility as one of the most significant advantages. The capability of spinning up new services without the time and effort often involved with conventional IT procurement ought to make it simpler and easier to get new applications up and running in a shorter amount of time. In addition, due to the elastic nature of the cloud, it will be much simpler and quicker to scale up a new application if it turns out to be a really popular one.

If a company uses an application that experiences significant spikes in usage, such as one that is only used during certain times of the week or year, it may make more financial sense for the company to have the application hosted in the cloud rather than investing in dedicated hardware and software that would be idle for the majority of the time. Moving to a cloud-hosted application for services like as email or CRM might relieve pressure on the internal IT team. However, if such apps do not provide a significant amount of competitive advantage, there will not be much of an influence in any other area. It is possible that switching to a services model may be beneficial for some businesses since it will shift spending away from capital expenditure (capex) and toward operational expenditure (opex).

What are the advantages and disadvantages of cloud computing?

Cloud computing is not always more cost-effective than traditional types of computing; similarly, renting is not always more cost-effective than purchasing over the course of a longer period of time. If an application has a regular and predictable need for computing services, it may be more cost-effective to deliver such services in-house than than contracting them out to an outside party.

There is a possibility that some businesses may be hesitant to hold critical data in a service that is being used by competitors. Moving to a SaaS application may also imply that you are utilising the same apps as a competitor, which may make it difficult to generate any kind of competitive edge if the application in question is essential to the operation of your company.

While it may be simple to begin utilising a newly released cloud service, moving previously used data or applications to the cloud may be a far more challenging and costly endeavour. And it would seem that there is now somewhat of a scarcity in cloud skills; more specifically, staff members with understanding of both DevOps and multi-cloud monitoring and administration are in especially short supply.

According to one research, a sizeable percentage of cloud customers with extensive experience said that they believed the one-time expenditures associated with migration eventually exceed the long-term cost benefits generated by IaaS.

Naturally, if you do not have a connection to the internet, you will not be able to use any of your programmes.

What is cloud-computing adoption doing to IT budgets?

Because corporations now purchase computing as a service rather than in the form of actual servers, cloud computing has a tendency to shift spending away from capital expenditures and toward operating expenditures. Using the cloud as a way to create space in the budget rather than going to the CFO and asking for additional money might be a simpler and more efficient way for businesses to avoid the big spikes in IT costs that are often associated with the launch of new projects.

If an application has a predictable and stable demand for computing power, it may be cheaper (at least from a processing power point of view) to keep it in-house rather than using cloud computing because the demand for computing power is known in advance. However, this does not mean that cloud computing is always or necessarily cheaper than keeping applications in-house.

How do you build a business case for cloud computing?

In order to construct a business case for migrating systems to the cloud, you must first have an accurate understanding of the expenses associated with your current infrastructure. There are a number of elements to take into consideration, such as the obvious cost of operating data centres and other expenses like leased connections. The cost of the actual gear, such as servers, as well as the specifics of the hardware, such as CPUs, cores, and RAM, as well as the cost of storage. You will also need to determine the cost of the apps, regardless of whether you want to get rid of them, re-host them in the cloud without making any changes, totally rebuild them for the cloud, or purchase an altogether new SaaS package. There will be various financial repercussions associated with each of these choices. The business case for the cloud must also take into account the costs associated with the people who will be using it (these costs are frequently only second to those associated with the infrastructure), as well as more abstract ideas such as the advantage of being able to roll out new services more quickly. Any business case for the cloud should also take into account the possible drawbacks, such as the danger of being dependent on just one provider for your information technology infrastructure (see multi-cloud, above).

Cloud-computing adoption

The use of the cloud is expected to increase, according to industry analysts, since it is now the driving force behind the majority of new technology disruptions. These include mobile banking and healthcare. It is difficult to see many new technological initiatives being completed that do not in some way take use of the cloud. According to Gartner, more than 85 percent of enterprises will adopt a cloud-first concept by the year 2025. Without this principle, these firms would not be able to effectively execute on their digital plans. According to the analyst, new workloads that are delivered in an environment that is native to the cloud will become widespread rather than merely popular, and everything that is not cloud-based would be regarded old. In 2021, just 30 percent of new digital workloads were deployed on cloud-native platforms. However, Gartner predicts that number would rise to over 95 percent by the year 2025.

And if you think that is an exaggeration, consider that the percentages of businesses that have adopted cloud computing vary depending on who you ask inside an organisation. Not all expenditure on cloud services will be driven centrally by the chief information officer (CIO). Since it is quite simple to sign up for cloud services, business managers may begin using them and pay for them out of their own budgets without having to alert the IT department. This may make it possible for organisations to move more quickly, but if the usage of applications is not monitored, it may also cause security problems.

Adoption will also vary depending on the application; for example, switching to cloud-based email is significantly simpler than switching to a new financial system. In addition, there will be less pressure in the near term to move systems that are already operating well, such as supply chain management, to the cloud. This is because the move might be expensive and fraught with possible danger.

What about cloud-computing security?

Analysts are of the opinion that cloud computing will continue to see increased adoption since it is now the driving force behind the majority of new technology innovations in a variety of industries, including mobile banking and healthcare. It’s difficult to see many new technological initiatives being implemented that don’t make use of the cloud in some capacity. According to Gartner, by the year 2025, more than 85 percent of enterprises will have adopted a cloud-first concept and would be unable to properly execute on their digital goals without it. According to the analyst, new workloads that are delivered in a cloud-native environment will become ubiquitous rather than just popular, and everything that is not cloud-based will be seen as old technology. Up from 30 percent in 2021, Gartner predicts that more than 95 percent of new digital workloads will be implemented on cloud-native platforms by the year 2025.

And if you think that’s an exaggeration, consider the fact that the percentage of businesses that have adopted cloud computing varies depending on who you ask inside a company. Not all expenditure on cloud services will be driven centrally by the chief information officer (CIO). Since it is rather simple to sign up for cloud services, business managers may begin using them and pay for them out of their own budgets without having to alert the IT department. If the usage of applications is not controlled, this may cause security problems for organisations, but it can also make it possible for enterprises to move quicker.

Adoption will also vary depending on the application: moving to cloud-based email is far simpler to accomplish than moving to a new financial system, for example. There will be less pressure in the near term to move potentially expensive and dangerous operations to the cloud for systems such as supply chain management that are already operating well in their current configuration.

What is public cloud?

The public cloud is the traditional implementation of cloud computing, in which users have access to a huge shared pool of computer resources over the internet (whether that is IaaS, PaaS, or SaaS). The capacity to swiftly expand a service is one of the main advantages offered by this solution. The providers of cloud computing have access to massive quantities of computer power, which, thanks to an architecture known as “multi-tenant,” they are able to distribute across a large number of clients. Because of their enormous scale, they have enough spare capacity that they can easily cope if any particular customer needs more resources. This is one reason why it is commonly used for less sensitive applications that demand a varying amount of resources: they have enough spare capacity to easily cope if any particular customer needs more resources.

What is private cloud?

Private cloud enables enterprises to benefit from some of the benefits of public cloud – but without the worries about ceding control over data and services, since it is hidden away behind the company firewall. Companies may manage precisely where their data is being housed and can create the infrastructure in a manner they desire – mostly for IaaS or PaaS projects – to provide developers access to a pool of computing capacity that expands on-demand without putting security at risk. However, that increased protection comes at a cost, since few organisations will have the size of AWS, Microsoft or Google, which means they will not be able to produce the same economies of scale. Still, for firms that demand greater protection, private cloud could be a valuable stepping stone, enabling them to comprehend cloud services or rewrite existing applications for the cloud, before putting them into the public cloud.

What is hybrid cloud?

It’s possible that everyone is now operating in a hybrid cloud environment, where they use a little bit of this and a little bit of that. There are some files stored in the public cloud, some projects housed in private clouds, several cloud service providers, and varying degrees of cloud use.

What are the cloud-computing migration costs?

It is not difficult to get started with cloud computing for new businesses that want to operate all of their systems there. But for the vast majority of businesses, things are not quite that straightforward: since they already have data and apps in place, they need to choose which of their platforms should continue operating normally and which should begin transitioning to cloud infrastructure. Moving to the cloud is a potentially dangerous and costly decision, and it might cost organisations even more money if they misjudge the magnitude of such initiatives, which could drive up the overall cost.

In a survey of 500 companies that were early adopters of cloud computing, one of the most significant costs was found to be the necessity of rewriting applications in order to optimise them for cloud computing. This cost was especially high when the applications in question were either highly specialised or complex. The high costs of transmitting data across systems was highlighted as a hurdle by one third of individuals who were polled as a barrier to relocating their business-critical applications. It is difficult and costly to locate employees with the necessary skills for migration, and even when organisations were successful in doing so, they ran the danger of having those skilled individuals poached by cloud-computing companies that had huge wallets.

In addition to this, the vast majority of respondents continued to express concern over the operation of important applications, and one third of respondents identified this concern as a reason for not relocating certain key applications.

Is geography irrelevant when it comes to cloud computing?

It seems that this is the point when the cloud has the most bearing on the situation. Users and providers of cloud computing are being subjected to major changes as a result of geopolitical factors. To begin, there is the problem of latency: if the programme is originating from a data centre on the other side of the world, or on the other side of a crowded network, then you can discover that it is slow in comparison to a connection that is local. That is the issue with the delay.

Second, there is the problem of determining who owns the data. Many businesses, especially those based in Europe, are subject to anxiety over the location of the processing and storage of their data. European businesses are concerned that American authorities may have access to their customers’ personal information if it is kept in data centres located in the United States or if such data centres are controlled by American corporations. As a consequence of this, the major cloud suppliers have been hard at work constructing a network of regional data centres so that businesses may retain their data inside their immediate geographic area.

Some companies have gone even farther, completely severing some of those datacenters from their primary company in order to make it much more difficult for authorities in the United States and other countries to seek access to the customer data that is held there. US parents are unable to access data stored in the data centres because those centres are under the jurisdiction of an independent corporation known as a “data trustee.” Without the approval of customers or the data trustee, US parents are unable to access data stored in the data centres. You may anticipate that cloud companies will create additional data centres in various parts of the globe in order to serve clients who have needs to store data in certain areas.

When it comes to incorporating cloud services into their supply chains, government organisations need to take into consideration the nation of origin, according to a warning issued by the cyber security agency of the United Kingdom government. Cloud security is another concern. Even though the warning was directed specifically at antivirus software, the problem exists for a variety of other kinds of services as well.

What is a cloud-computing region? And what is a cloud-computing availability zone?

The vast datacenters located all over the globe are where cloud computing services are managed and run. This is broken down further by AWS into “regions” and “availability zones.” A different geographic location makes up each AWS region, such as Europe (London) or the United States West (Oregon), and each region is further subdivided into what AWS refers to as availability zones (AZs). An availability zone (AZ) is made up of one or more datacenters that are located at sufficient physical distances from one another so that, in theory, a single disaster cannot bring both of them offline at the same time, but they are also located close enough to one another to support business continuity applications that require rapid failover. AWS has approximately 80 Availability Zones (AZs), each of which has multiple internet connections and power connections to several grids.

A similar concept is used by Google, which divides its cloud-computing resources into regions, which are further broken into zones. These zones each include one or more datacenters, from which clients may operate their respective services. It now spans eight zones, which are as follows: Customers should consider deploying their applications across different zones and regions, since this will help protect them from unexpected failures. Google makes this recommendation.

The resources that are available via Microsoft Azure are divided in a somewhat unique manner. It provides regions, which it defines as being composed of “a cluster of datacenters placed inside a latency-defined perimeter and linked by a specialised regional low-latency network.” Customers that have unique data-residency and compliance demands may make use of the company’s ‘geographies,’ which often consist of two or more areas, “to keep their data and applications nearby,” according to the company’s website. In addition to this, it provides availability zones, which are clusters of one or more data centres each with its own independent sources of power, cooling, and networking.

Cloud computing and power usage

These data centres also use an enormous amount of electricity; for instance, Microsoft recently reached a contract with General Electric to acquire all of the production from GE’s new 37-megawatt wind farm in Ireland for the next 15 years so that it may power its cloud data centres. Ireland has said that it now anticipates that data centres would account for 15 percent of overall energy consumption by the year 2026, which is an increase from less than 2 percent in 2015.

Which are the big cloud-computing companies?

When it comes to infrastructure as a service (IaaS) and platform as a service (PaaS), there are really just a few major cloud providers. Amazon Web Services is now in the driver’s seat, followed by Microsoft’s Azure, Google, and IBM in the group immediately behind it. According to the findings of Synergy Research, Amazon, Microsoft, and Google continue to draw well over half of global cloud expenditure. These three companies had respective market shares in the third quarter of 33 percent, 20 percent, and 10 percent. And since their growth rates are faster than the whole market’s growth rates, their proportion of total global revenue is continuing to increase. However, this still leaves a substantial amount of money for the corporations who are following closely behind, which amounts to around $17 billion. According to the analyst, “it is abundantly clear that there are issues looming in the background with the major three corporations; thus, the name of the game is not competing with them straight on.”

AWS, Azure and Google Cloud – what’s the difference?

Each of the three largest cloud providers has a unique set of advantages. Amazon’s capacity to sustain massive seasonal fluctuations in customer demand was made possible, in large part, by AWS, which is the most established participant in the market. It was the first company to bring cloud services to market, and it worked very hard to obtain market share. These two factors helped it become the industry leader, and it continues to innovate. Microsoft Azure has emerged as an important component of the company’s overall strategy, and Microsoft as a whole has the necessary corporate experience and product offerings to assist companies in making the transition to the cloud. Although Google Cloud is the least significant of the top three providers, it is obvious that the advertising-to-Android behemoth is supporting it with all of its strength.

Who are the other main cloud-computing players?

In addition to the big three, there are a number of other companies, including Alibaba Cloud, IBM, Dell, and Hewlett Packard Enterprise, who are interested in participating in the enterprise cloud initiative. It goes without saying that almost every software firm, from industry titans like Salesforce to fledgling startups, is now operating as a SaaS business.