This seems a strange question, since you probably already have some concept of "the cloud". However, given some of the conversations I've been having recently, I think there is a good deal of cloudy thinking about cloud computing.So here is the gist of what the cloud is (imho) summed up for you in a set of bullet points:
"Cloud Computing" is currently a marketing term. And that's why I'm writing this; divorce the use of Cloud Computing, the marketing term, from the use of Cloud Computing as an architectural idea. Marketing terms do not have to conform to precise definition. They get used, then abused, then severely exploited and finally, as your car stops, get settled in the pile of buzzwords feel broken. That's what happened to "electronic commerce", "Web Services", "On Demand" and so on. Until the recession began in earnest Cloud Computing was a reasonably sane marketing term. That is now changing because, in the minds of the IT audience, the cost of cloud computing is lower. That makes cloud the hype-word of the day.
Cloud Computing is not SaaS (Software as a Service). I am making this point because some commentators have likened these two ideas as if they were identical. SaaS is healthy terminology. SaaS is a software that can be accessed directly outside housed. Although you may not think of it as such, your electronic banking capability is SaaS - you just do not pay for it directly. As such electronic banking is no different to Zoho or Google Apps. However, electronic banking is definitely not Cloud Computing, no matter how much you stretch the definition.
Cloud Computing is not about Emulating Google It looks suspiciously like the initial enthusiasm for cloud computing as a strategy was prompted by Google envy technology. Google was doing something unprecedented in building huge data centers to support your business. It was clearly a fact that Google's operation was highly efficient and some CIOs mused about whether they could emulate Google. Actually there was no chance, because Google's business was defined by just two uncommon transactions: searching the web and placing ads. Google designed a huge massively parallel operation using servers and switches they built themselves within an architecture that is optimized for precisely that workload. You can not emulate that unless, like some social networking sites, which has a small variety, but a large number of transactions. As expected, some social networking sites have emulated Google.
Cloud computing is about Technology Stacks Cloud computing is technology stacks in the same way that the ISP business is technology stacks. In general, ISPs offer consistent service to the myriads of web sites that host by using a set of standard technology, more commonly, the LAMP (Linux Apache, MySQL, PHP). This means that management effort is minimal because everyone is running the same application (a web site) with the same technology (LAMP) and, where customers have problems, which will normally be the same issues arise again and time.
Cloud Computing is economies of scale The only thing everyone seems to agree upon about Cloud Computing is that it is constructed for scale and that is hosted on a set of resources that are distinct from the typical IT network. In other words within "the cloud" there is an attempt to build scale architecture. Most cloud offerings will be based on scalability. The truth is that if you have a large data center and its use, will be organized so that most of the workloads are very similar, or better, identical, then you will achieve significant economies of scale. Then you will be able to offer the service at prices that undermine customer costs of running the application in the enterprise. The more customers get the best cost advantage.
Cloud Computing is not typical center outsourcing company data is not a cloud and will never become one. the whole technology stack is mixed - their workloads running platforms are mixed are mixed. This means you can not transform the whole data center into a cloud operation. However, you can outsource.
Are there standards cloud computing? Not really, or perhaps better to say "not yet". In general, cloud computing infrastructure is based on servers that employ virtualization technology to deliver efficient resource utilization and generally are governed by open standards and, for the sake of economy, use the software code open widely. It is an organization formed by a group of universities, called the Cloud Consortium (OCC), which is promoting open frameworks that will let clouds operated by different organizations work together seamlessly.
Is there such a thing as an internal cloud? Again, not really, or perhaps better said "not yet." There is no sense in organizations creating "domains" within their own networks that are based on cloud-type architectures, especially if they have applications that may need to scale over time. If there cloud standards then such domains could be considered as internal clouds. They would become staging areas for moving internal applications possibly in the cloud, or if the organization has its own software that it intends to offer as a service, then a domain of this type could become the platform for the delivery of that service.
Cloud Computing is nothing to do with Web 2.0? Nothing at all. But you can make the connection, if desired. Many websites that are said to be Web 2.0, primarily because they are social networking sites, have had to reduce dramatically when their user population shot into the millions. Because they have had to adopt highly scalable architectures (or die). Because they have such architectures they may be in a good position to offer some services to users in the form of cloud computing.
The clouds do offer guaranteed service levels? The answer to this is "yes" or at least it should be, and in the future will surely be. We have to exclude free services, like Yahoo Mail and many of Google's services, which can be described as Cloud Computing from most perspectives, because a free service is never going to offer guarantees (even if a life is excellent ad.) But cloud Computing will ultimately be defined, from the user's perspective, by service levels and the nature of the service itself. If Cloud Computing Services are well defined in that way, then it becomes possible to compare such services with the cost of providing a similar capability from your own data center - as long as the provider of Cloud Computing is transparent in every detail of technology It is unfolding.