What is Cloud Computing?

The fundamental idea behind cloud computing involves taking products and converting them into services. Cloud computing incorporates different aspects of computing, such as networking infrastructure, software, and storage, all while delivering those products as a service with a pay-as-you-go pricing structure. The user’s data is stored at a remote location, accessible through the Internet. Service providers manage all of the infrastructure and/or software for users, freeing up the customers’ time to focus on other critical tasks and processes. Numerous vendors store data in multiple datacenters that are geographically dispersed in different regions in the US and the rest of the world. This way, if a natural disaster or power outage occurs locally, users can still access their data in the cloud via another datacenter.

There are four main types of cloud computing: Storage as a Service, Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). The differences and specifics are easiest to follow when they’re broken down into three layers:

  1. The bottom, and most simple layer would be IaaS, along with StaaS, as the two are closely related. This layer contains all of the networking equipment and server hardware needed to produce a cloud environment.
  2. The second layer contains “platform software” needed for developing and modifying applications. Platform-software enterprises will often use IaaS to support their works and simply build “over it”. Here, PaaS is in the center of the three cloud layers.
  3. The top layer of the stack includes any application that a consumer/employee might use, ranging from management programs to CRM applications. This also includes any underlying development/modification software (platform) and infrastructure. This is the SaaS layer.

Cloud computing has gained tremendous momentum as it heads into 2012. The US is currently leading the way in the adoption of cloud computing; the NPD Group reported that 76% of Americans used an internet-based cloud service in the past year, with 22% even familiar with the general “cloud computing”. Europe is not far behind in adopting cloud technology; the Experton Group predicted that the German cloud computing market would grow from €1.14 billion ($1.5 billion) to €8.2 billion ($10.8 billion) by 2015.

Many organizations and consumers have already taken a progressive step into cloud computing, utilizing the great benefits and advantages that the space provides:

  1. Saves time and money: the pay-as-you-go approach lets users only pay for what they use. Hardware does not need to be re-purchased or renewed. The purchase of new resources (for businesses) can be instantaneous through the cloud.
  2. Elastic/scalable: infrastructure can be easily increased or decreased as needed. This is important for handling spikes in traffic and ensuring that the service never goes offline. Also, this ensures that the pricing accurately reflects the needed resources; businesses should only pay for what they need. Since the equipment is elastic, changes in structure or layout are immediate.
  3. Lower barriers to entry: smaller businesses with fewer resources can enter the market using the cloud. They pay a recurring fee to offset the up-front costs of infrastructure and software, of which usually amounts to large debts.
  4. Security and reliability: multiple datacenters allow information to be stored in more than one region (redundancy). If a natural disaster or power outage occurs, information would still be accessible. Most vendors provide (at least) a 99% uptime guarantee. Cloud service providers can implement significant security measures to protect information. This is crucial for an organization that manages their own IT, purchasing security features may not be as cost-effective.
  5. Speed/agility: Products can get to market fast, while configurations and updates can be instituted quickly. This results in less downtime of services, while transitions and updates can be added in real-time without stoppage.
  6. Accessibility: data in the cloud can be accessed anywhere, using any Internet connected device.
  7. Environmentally friendly: New datacenters are often with built with efficient power-saving equipment. Many datacenters employ renewable energy as well. Further, these datacenters are often constructed near natural water sources to induce natural cooling.

History & Trending

Cloud computing was born from companies underutilizing their datacenters. The extra space became a product that could be sold to businesses that needed all of the computing components, cutting out the massive overhead required to build and maintain an independent datacenter. Forrester recently reported that most companies use less than 50% of their total datacenter capacity. McKinsey and the Uptime Institute conducted a study that concluded that only 6% of servers in datacenters are used on average.
Die Idee der Netzwerkoptimierung wurde erstmals mit der Einführung von günstigen Virtual Private Networks (VPN) durch die Telefonindustrie in die Praxis umgesetzt, indem durch geschickte Steuerung des Datenverkehrs die vorhandene Netz-Bandbreite optimal genutzt wurde.

The concept of network optimization was put into practice when the telecom industry began offering virtual private network (VPN) services at a lower price, mainly by manipulating traffic to optimize the use of network bandwidth. When Amazon discovered that they were usually using about 10% of their total capacity (leaving room for holiday spikes in traffic), they decided to modernize their data centers to improve efficiency. The new architecture allowed them to add features faster and more easily. After seeing these results, they decided to develop a product that could provide a level of efficiency externally, utilizing their empty (but purchased) computing infrastructure. The product was packaged as Amazon Web Services (AWS) Utility Computing, and was launched in 2006. The availability of these high capacity networks, combined with the increasing performances of computer equipment and storage, helped make this concept realistic. The adoption of virtualization also played a significant role in the emergence of cloud computing.

In 2011, the German market for outsourcing reached €20 billion ($26.3 billion); a study in 2011 by IDC showed 70% of German companies were working or planning a cloud computing strategy for business. Gartner predicts the size of the global cloud computing market to be €121 billion ($160 billion) by 2013. Gartner also suggests that in Western Europe alone, the market could grow to €36 billion ($47.4 billion) by 2015. The widely applicable advantages of the cloud, from business application to personal entertainment, justify this exponential growth. In general, Cloud computing saves time, money, and takes the intricacy out of the technical side of a company, allowing employees to focus on other areas of the business.