What is cloud computing?

Cloud computing means leasing computing resources from a third party and accessing them over the internet. That might mean saving files onto a remote server, developing programs on a hosted cluster, or running a line-of-business application where the data storage and processing are handled offsite.

There are several types of cloud computing, which we explore elsewhere: hybrid cloud, public cloud, private cloud and multicloud.

What are the benefits of cloud computing?

A major benefit of cloud computing is flexibility. If a company receives a sudden influx of business, it may wish to expand its server capacity. With in-house servers, that entails a significant investment of time and resources. With cloud services, extra capacity can be brought online in moments – and decommissioned again when demand dies down.

Cloud computing also lightens the administrative load. Companies that run their own file storage or application servers need to handle continuous support and maintenance, including patch management and software updates. With a leased solution, these responsibilities are handled by the cloud provider, allowing IT staff to focus on more productive tasks.

A third attraction of cloud computing is cost. Buying and upgrading server hardware is a major capital expense; with cloud computing, you can lease exactly what you need when you need it, and pay for it with a predictable recurrent fee.

What are the downsides to cloud computing?

Cloud computing means entrusting part of your business to a service which you don’t control. If a cloud server fails – or if you lose your internet connection – there’s nothing your in-house IT team can do to get you back up and running.

Concerns may also arise about security. Without direct oversight of the cloud servers, you just have to trust that the provider will keep its systems protected from leaks and hack attacks. You could be legally liable if sensitive information is compromised because you chose to store it on a cloud platform.

With hosted applications, lock-in may also be a concern. If company data is stored inside a third-party database and integrated into a hosted application, it may be difficult or impossible to extract it should you wish to migrate to a different solution.

And while cloud computing can be very cost-effective, storing data in the cloud is expensive compared to local storage. Keeping data in house can save money, and provide performance benefits too: your internet connection is unlikely to be as fast as a wired connection to an on-premises storage server.

What is the future for cloud computing?

Cloud computing is traditionally associated with servers, but it’s broadening its reach. In 2021, Microsoft began to offer Windows as a cloud platform, with users accessing a hosted desktop over the internet. Several video-game manufacturers have also embraced the cloud model, offering games that stream from a remote server rather than running on a local console or PC.

In the coming decade, we’re likely to see the cloud model extend to all areas of computing. As fast 5G coverage becomes widespread, even mobile and wearable devices will be viable platforms for remote services. That is likely to accelerate still further with the rise of 6G.