From a user's point of view, a good cloud computing definition is using web applications and/or server services that you pay to access rather than software or hardware that you buy and install.
It might be more accurate, however, when asked, "What is cloud computing?" to define cloud computing as computer services delivered via the Internet, as cloud computing encompasses more than web applications and data storage.
There are three categories of cloud computing:
- Infrastructure as a Service (IaaS),
- Platform as a Service (PaaS) and
- Software as a Service (SaaS).
Infrastructure as a Service (IaaS) provides the user with virtual infrastructure, such as servers and data storage space. This is where virtualization fits into the cloud.
Platform as a Service (PaaS) provides the user with development environment services where the user can create and run home-grown applications.
Software as a Service (SaaS) provides the user with access to already created applications that are operating in the cloud.
So if, for example, I use cloud computing to access online accounting and payroll services, rather than investing in accounting and/or payroll software and installing it on the server that resides at my business, I am using SaaS.
All three categories of cloud computing offers obvious advantages for businesses of all sizes. The huge advantage is that you don't need the infrastructure or the knowledge necessary to develop or maintain the infrastructure, development environment or application; someone else is taking care of all that.
And being able to outsource all of the hassle and expense of housing and maintaining can provide some real cost (and headache) benefits to small businesses. For a detailed discussion of the advantages of cloud computing for small businesses, see Why Cloud Computing Is Ideal for Small Businesses.
There are downsides, as I discuss in 5 Disadvantages of Cloud Computing.
But generally, in my opinion, cloud computing is going to make accessing, using and managing IT easier for small businesses than ever before.
Why cloud computing? Cloud is a metaphor for the Internet. Plus it's just a catchy name. Marketing always matters.