Some summary from http://en.wikipedia.org/wiki/Cloud_computing
In computer networking, cloud computing is a phrase used to describe a variety of computing concepts that involve a large number of computers connected through a communication network such as the Internet. It is very similar to the concept of utility computing. In science, cloud computing is a synonym for distributed computing over a network, and means the ability to run a program or application on many connected computers at the same time.
The phrase is often used in reference to network-based services, which appear to be provided by real server hardware, and are in fact served up by virtual hardware, simulated by software running on one or more real machines. Such virtual servers do not physically exist and can therefore be moved around and scaled up or down on the fly without affecting the end user, somewhat like a cloud becoming larger or smaller without being a physical object.
In common usage, the term “the cloud” is essentially a metaphor for the Internet. Marketers have further popularized the phrase “in the cloud” to refer to software, platforms and infrastructure that are sold “as a service”, i.e. remotely through the Internet. Typically, the seller has actual energy-consuming servers which host products and services from a remote location, so end-users don’t have to; they can simply log on to the network without installing anything. The major models of cloud computing service are known as software as a service, platform as a service, and infrastructure as a service. These cloud services may be offered in a public, private or hybrid network. Google, Amazon, Oracle Cloud, Salesforce, Zoho and Microsoft Azure are some well-known cloud vendors.
Infrastructure as a service (IaaS)
In the most basic cloud-service model, providers of IaaS offer computers – physical or (more often) virtual machines – and other resources. (A hypervisor, such as Hyper-V or Xen or KVM or VMware ESX/ESXi, runs the virtual machines as guests. Pools of hypervisors within the cloud operational support-system can support large numbers of virtual machines and the ability to scale services up and down according to customers’ varying requirements.) IaaS clouds often offer additional resources such as a virtual-machine disk image library, raw (block) and file-based storage, firewalls, load balancers, IP addresses, virtual local area networks (VLANs), and software bundles. IaaS-cloud providers supply these resources on-demand from their large pools installed in data centers. For wide-area connectivity, customers can use either the Internet or carrier clouds (dedicated virtual private networks).
To deploy their applications, cloud users install operating-system images and their application software on the cloud infrastructure. In this model, the cloud user patches and maintains the operating systems and the application software. Cloud providers typically bill IaaS services on a utility computing basis: cost reflects the amount of resources allocated and consumed.
Cloud communications and cloud telephony, rather than replacing local computing infrastructure, replace local telecommunications infrastructure with Voice over IP and other off-site Internet services.
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