What is Cloud Computing: Complete Guide

Read time 6 mins

Written May 2021


Buzzwords have a reputation for lacking substance. There is one, however, that is fluffy by name but not by nature: the “Cloud”. Unfortunately, many of us have our head stuck in the clouds when it comes to understanding one of the most significant elements of the digital age. The good news is you don’t need to be Tim Berners-Lee to figure it out: essentially, the cloud is just a metaphor for the internet. Delve a little deeper and we see that it refers to servers that are accessed over the internet and the software and databases that run on them.

So, what is “Cloud Computing” – another ubiquitous buzzword that is inextricably linked to the cloud and appears a mere 48 million times on the internet? In layman’s terms, this means storing and accessing data and programmes over the internet instead of your computer’s hard drive. By leveraging Cloud services, users and businesses don’t have to manage physical servers themselves or run software applications on their own devices, meaning less overheads and time spend managing them.

According to Microsoft, it is “the delivery of computing services – including servers, storage, databases, networking, software, analytics and intelligence – over the internet (“the Cloud”) to offer faster innovation, flexible resources and economies of scale. Typically, you only pay for Cloud services you use, helping you lower your operating costs, run your infrastructure more efficiently and scale as/when your business needs change.”

History of Cloud Computing

The concept of network-based computing can be traced back to the 1960s, but the term “Cloud Computing” in its modern context is believed to have first been uttered on 9 August 2006, when then Google CEO Eric Schmidt introduced the term at an industry conference: “What’s interesting is that there is an emergent new model,” Schmidt said, “It starts with the premise that the data services and architecture should be on servers. We call it Cloud Computing – they should be in a “Cloud” somewhere.”

Following these epochal words, the Cloud industry began to take shape, with data centres bearing the weight before private Clouds began to emerge – reshaping the IT landscape forever. In 2010 for example, Microsoft launched Microsoft Azure – aka a Microsoft ‘Cloud’. Since then, this paradigm has evolved from being something service providers suggested businesses should adopt, to the technological heartbeat of most modern enterprises – providing them with the flexibility and efficiency to meet new and growing demands.

SaaS vs PaaS vs IaaS

Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS) are three models of Cloud Computing service available to your business:

  • SaaS: this represents the most commonly used Cloud model for businesses. SaaS utilises the internet to deliver software and applications to its users via a third-party vendor. Applications typically run directly through a web browser, meaning they don’t require any downloads or installations on the client-side.
  • PaaS: this provides a framework for developers to build upon and use to create customised applications, without having to implement and maintain the infrastructure. Servers, storage, and networking can be managed by the business or a third-party vendor, while the developers can maintain management of the applications.
  • IaaS: this offers highly scalable and automated cloud-based, pay-as-you-go services such as storage, networking, monitoring and virtualisation. IaaS allows businesses to purchase resources on-demand when needed, instead of having to buy hardware outright.

Advantages and disadvantages of Cloud Computing

Harnessing the power of Cloud Computing to streamline IT processes has advantages and disadvantages. These include:


  • Cost-effective: overhead technology costs are reduced significantly, as Cloud Computing does not require any physical hardware investments. In addition, you do not need trained personnel to maintain the hardware – this is managed by the Cloud service provider e.g. Azure.
  • Accessibility: access to data anywhere, anytime. This maximizes productivity and efficiency by ensuring applications are always available, allowing for easy collaboration and sharing among users in multiple locations.
  • Scalability: the Cloud is easily scalable, allowing your business to add or subtract resources based on their unique needs. As your business grows, your technology will grow with it.
  • Rapid deployment: a Cloud infrastructure can be established and accessed easily and quickly. This allows your business to retain the same applications and processes without having to deal with backend technicalities.
  • Unlimited storage capacity: the Cloud offers almost limitless storage capacity, which can be rapidly expanded with nominal monthly fees.


  • Lower bandwidth: Cloud storage service providers often limit bandwidth usage of their users, which can impact performance if not accounted for. If your business exceeds its allowance, additional charges may apply.
  • Downtime: your Cloud provider may face power loss, low internet connectivity, or service maintenance issues. Perhaps the single greatest disadvantage of Cloud Computing, downtime should be a major consideration.
  • Security: while there are security advantages of Cloud Computing, you must be mindful that you will be sharing your business’s sensitive information with a third-party service provider, which could be targeted by hackers.
  • Limited features: not all Cloud services are the same. Some providers offer limited packages, meaning you may not receive every feature or customisation you require.

Types of Cloud

Cloud Computing can be categorised into three general types:

Private Cloud

This consists of Cloud Computing resources used exclusively by one business. The private Cloud can be physically located in your business’s on-site data centre or hosted by a third-party vendor. The services and infrastructure are always maintained on a private network, with the hardware and software dedicated solely to your business – making it easier to customise resources to meet specific IT requirements.


  • Greater flexibility
  • More control over resources
  • Improved scalability


  • More expensive
  • Limited access for mobile users
Public Cloud

This is the most common type of Cloud Computing. Cloud resources, such as servers and storage, are owned and operated by a third-party Cloud vendor and delivered via the internet. Your business shares hardware, storage and network devices with other Cloud “tenants”. You access services and manage your account using a web browser. Typical deployment includes: web-based email, online office applications, storage, and testing and development environments.


  • Lower costs
  • No maintenance
  • Near-unlimited scalability
  • High reliability


  • Lack of cost control
  • Lack of security
  • Minimal technical control
Hybrid Cloud

This type of Cloud Computing combines on-premises infrastructure (a private Cloud) with a public Cloud, allowing data and applications to move between the two environments. A hybrid Cloud approach is typically used to meet regulatory requirements, take full advantage of on-premises technology investment, or address low latency issues.


  • Private infrastructure for sensitive assets or workloads
  • Flexibility to leverage additional resources in the public Cloud
  • Cost-effective
  • Gradual migration


  • Lack of integration between different Cloud infrastructures
  • Greater infrastructure complexity

According to a recent industry survey on IT budgets for 2021, Microsoft Azure and Amazon Web Services are the Cloud service providers of choice. Other key players include Google Cloud Platform and hybrid Cloud and traditional data centre vendors such as IBM, Dell Technologies, Hewlett-Packard Enterprise, and VMware.

Cloud security

The deployment of any Cloud service presents data security challenges and risks. Security for the data created in the Cloud, sent to the Cloud, and downloaded from the Cloud is the responsibility of the Cloud customer – your business. The following three steps can provide you with the visibility and control needed to establish a secure Cloud environment:

  • Understand usage and risk: you must understand your current state, assess the risk, and understand your risk appetite. Use Cloud security solutions that allow for Cloud monitoring.
  • Protect your Cloud: strategically apply protection to your Cloud services according to your business’s risk appetite.
  • Respond to security issues: incidents requiring either automated or guided response will occur, just like any other IT environment. Follow best practices to proactively mitigate Cloud security incidents: implement additional verification for high-risk access scenarios; adjust Cloud access policies as new services arise; and, remove malware from Cloud services.

Using Cloud Computing

When building out a Cloud strategy, you must understand exactly why you want to leverage this technology before defining clear objectives. Typical scenarios where Cloud Computing is used to enhance the achievement of business goals include: delivering software on demand, big data analytics, disaster recovery, embed intelligence, creating Cloud-native applications, test and build applications, and store, back up and recover data.

Forward-thinking businesses are moving away from traditional on-premise solutions to adopt a Cloud-first strategy – and they are not doing it alone. They are working in partnership with outsourced IT providers who have the knowledge and experience to successfully plan, implement, use, and manage Cloud technology that’s right for their business.

Cloud Computing was already fast becoming the go-to model for IT before the Covid-19 pandemic blindsided society in 2020. Subsequent digital transformation shifts, accelerated by lockdown-enforced homeworking, have accentuated this trend. Enabling the new normal way of working by embracing Cloud Computing provides the infrastructure, software, and platforms necessary for success in today’s unique business landscape.

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