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Cloud computing is a type of computing that relies on sharing computing resources rather than having local servers or personal devices  to handle  applications .

In cloud computing, the word  cloud  (also phrased as "the cloud") is used as a metaphor for "the Internet," so the phrase cloud computing means "a type of Internet-based computing," where different services -- such as servers, storage and applications -- are delivered to an organization’s computers and devices through the Internet.

In the simplest terms, cloud computing means storing and accessing data and programs over the Internet instead of your computer’s hard drive. The cloud is just a metaphor for the Internet. It goes back to the days of flowcharts and presentations that would represent the gigantic server-farm infrastructure of the Internet as nothing but a puffy, white cumulonimbus cloud, accepting connections and doling out information as it floats.

  

How Cloud Computing Works

The goal of cloud computing is to apply traditional  supercomputing , or  high-performance computing  power, normally used by military and research facilities, to perform tens of trillions of computations per second, in consumer-oriented applications such as financial portfolios, to deliver personalized information, to provide data storage or to power large, immersive computer games.

To do this, cloud computing uses  networks  of large groups of  servers  typically running low-cost consumer PC technology with specialized connections to spread data-processing chores across them. This shared  IT infrastructure contains large pools of systems that are linked together. Often,  virtualization  techniques are used to maximize the power of cloud computing.
 

Cloud Computing Standards

The standards for connecting the computer systems and the software needed to make cloud computing work are not fully defined at present time, leaving many companies to define their own cloud computing technologies.  Cloud computing systems offered by companies, like  IBM ’s "Blue Cloud" technologies for example, are based on open standards and  open source software  which link together computers that are used to to deliver  Web 2.0  capabilities like  mash-ups  or  mobile commerce .
 

Cloud Computing in the Data Center and for Small Business

Cloud computing has started to obtain mass appeal in corporate data centers as it enables the data center to operate like the Internet through the process of  enabling computing resources to be accessed and shared as virtual resources in a secure and scalable manner.

For a small and medium size business ( SMB ), the benefits of cloud computing is currently driving adoption. In the SMB sector there is often a lack of time and financial resources to purchase, deploy and maintain an infrastructure (e.g. the software, server and storage).

In cloud computing, small businesses can access these resources and expand or shrink services as business needs change. The common  pay-as-you-go  subscription model is designed to let SMBs easily add or remove services and you typically will only pay for what you do use.