What Cloud Computing Really Means?

Published by MBA Skool Team, Published on September 15, 2012

Even 50 years ago a typical Indian household used to have well in their house. Now Indians get their water supplied by shared public utility resource. People no longer bother about maintaining the well. Instead they just use the tap whenever they need water. Cloud Computing can provide similar services to the companies. Cloud Computing is easily the most happening thing in the world of Information Technology.

Almost all companies are expected to go for cloud service as they look to focus on their core competencies rather than bothering about infrastructures. When we think of IT we always think of ways to increase capabilities without investing in new infrastructure. The technology of Cloud Computing has shown its amazing impact doing just that. 

Cloud Computing enables storage capacity and computing power to be delivered as a service. Ever since the inception of the computer the computing power was fully dependent on the machine hardware. Cloud Computing has transformed this computing power from product to a service by providing utility over a network – just like internet. End users can access applications through a web browser with the required software and data stored on servers at a remote location.

How it works?

A ‘Cloud’ is basically a network of computers or servers. These computers are linked together in a collaborative manner and the resulting network provides a massive storage capacity. If cloud computing is used, there will be a workload shift and the local computers need not bother about the hardware or software demands. The local computers should be able to run the cloud computing systems interface software through which the end users can log into a web service. Through that web service the users will be able to access the needed hardware/software from a remote machine. Thus the computing power, which was earlier dependent only on local machine, got transferred to the cloud. Hence cloud transformed computing power from product to service.

There are three types of cloud computing:

  • Computing as a Service (CaaS)
  • Infrastructure as a Service (IaaS)
  • Platform as a Service (PaaS)

Through CaaS, users use application software or databases of the cloud provider.  Similarly using IaaS and Paas, the users rent the use of servers and system software from the cloud provider.

Types of cloud

There are basically four types of clouds:

  • Private cloud
  • Public cloud
  • Community cloud
  • Hybrid cloud

Private Cloud – Private cloud caters to the needs of a single organization. Internet based service is not necessary for private cloud. Here a company gets all the benefits without risking its security. NetApp is a major company offering private cloud services.

Public Cloud – Public cloud facilities are provided to the public by general service provider. The service providing company owns and operates the infrastructure. The service is made available to the users via internet. Tech biggies like Microsoft, Google are among the public cloud service providers. ‘Google Docs’ is a widely used public cloud service. Security is so far a concern in public cloud service. Public cloud requires extra time and effort to ensure security.

Community Cloud – In case of community cloud, cloud infrastructure is shared by more than one organization. Participating organizations are from a specific community and have similar needs. Cost of community cloud is more than public cloud but less than private cloud.

Hybrid Cloud – Hybrid cloud is a combination of two or more clouds of different types. Hybrid cloud can offer benefits of private, public or community clouds. Through hybrid cloud, each aspect of business can be kept in the most suitable environment. For example, the user interaction can be done through a public cloud but data are kept in a private cloud to ensure more security.

Why Cloud computing?

So why companies should be interested in cloud computing? This is already explained briefly in the introduction section. Using cloud companies can get rid of the unnecessary burden of maintaining the infrastructure and focus on their core competencies. Early adoption of cloud can enable the organizations to transform their business model earlier than the competitors and get a competitive advantage. The major advantages of adopting cloud service are:

  • The main advantage is reduced cost. Cloud services allow organizations to bring down their capital expenditure. Cloud computing brings in digital infrastructure. This, along with the pay-as-you-go model in services reduces capital expenditure significantly.
  • Cloud computing allows the IT cost to transfer into operating expense.
  • Scale of operation can be increased quickly when needed. Similarly the organizations can scale down their operations as well. This is very important for logistics management.
  • Cloud computing service enables the companies to focus on their core competencies without paying much attention to the trivial things. For example IT companies need not worry about server updates.
  • Cloud computing makes a customer’s experience seamless as the customer need not bother about hardware requirements of his system. It also gives them mobility as they can access from anywhere.


In spite of being a great innovation cloud computing has some down sides. The major issues are actually interlinked. Security and privacy are the two major issues that are preventing implementation of cloud in a large scale. Full benefit of cloud can be taken only through public cloud. If public cloud network becomes reliable then government will also incorporate the use of cloud services. Currently government organizations are skeptical about the security. Since the reduction in expenditure is not a major driver, government is not going for cloud services at this moment.

Technically cloud is a network. Like all other network based applications, cloud network can be hacked. Online service is any day more prone to threats than PC. Companies are not confidant about keeping their sensitive information on cloud based network.

Privacy is also a major concern for keeping sensitive information. Though cloud service providers ensure that data is not accessed by any unauthorized user, skepticism remains. Service providers have also come up with password protected accounts, advanced data encryption technique etc to save privacy. Reputation of the service provider will be the key in this issue.

Accessibility plays a big role in cloud computing. This is especially significant in developing countries like India where there’s a wide gap between cities and rural areas. Internet facilities are not developed in rural areas. For this reason government companies are not interested in cloud computing as there’s no guarantee that cloud applications will reach remote areas like hilly states.


Regardless of the issues, cloud computing is here to stay. Success of the cloud is dependent on the government’s adoption. With time we can surely hope all the above mentioned issues will be solved gradually. The ability of cloud to tap into computer applications would free the government institutions to manage their own technology infrastructure. Even the rural area will be greatly benefited by this as applications like e-learning, weather information, credit approvals and most importantly agricultural information can be easily made available on the platform.

To take the benefit of cloud platform, the government must also show pro-activeness. The government needs to evolve standards, guidelines and regulations which the vendors must follow. The guidelines will also act as motivations for the vendors to develop their network accordingly. With the implementation of cloud in government services, the private organizations will get rid of the skepticism they currently have. We can expect that transform of computing from product to service is heading towards its completion.

This article is authored by Sayak Gupta from SIMSR.

Image: FreeDigitalPhotos.net

Views expressed in the article are personal. The articles are for educational & academic purpose only, and have been uploaded by the MBA Skool Team.

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