What is cloud computing?

Think about how you get electricity. You do not own a power station. You plug in a kettle, you use some units, and the bill counts what you used.

Now think about a shop that runs its own generator. The owner bought it, fuels it, services it, and it stands idle most of the day. Both ways give you power. However, they do not cost the same, and they do not fail in the same way.

Cloud computing is the electricity model, applied to computers. Somebody else owns the machines, and you reach them over the internet and pay for what you used.

What “the cloud” actually is

There is no cloud in the sky. The cloud is a building full of computers, plus the network that reaches it.

Those buildings are called data centres. Each one holds rows of machines, heavy power supplies and strong cooling. Our explainer on the data centre covers what sits inside one.

When you use a cloud service, your request travels to one of those buildings. The work happens there, and the answer comes back. That is the whole trick. The word cloud only means you do not need to know which machine did the job.

What you are actually renting

Cloud services come in three levels, and the difference is how much of the work you keep for yourself.

The first level is raw machines. You rent computing power, storage and network, then install everything else yourself. This suits a team that wants full control.

The second level is a ready-made workshop. The provider looks after the operating system and the plumbing, and you supply the program. You give up some control and save a great deal of time. Serverless computing is the far end of this idea.

The third level is finished software. Email, a spreadsheet, an accounting package. You simply log in, and most people use the cloud only at this level and never think about the rest.

Why anyone moves to it

• No large payment up front, because you rent instead of buying.
• You can grow in minutes. A shop expecting a busy weekend adds machines on Friday and drops them on Monday.
• Somebody else replaces broken disks and keeps the hardware current.
• You can start today. Ordering and installing your own servers takes weeks.
• You can sit close to your users by choosing a data centre near them.

The second point is the real one, because most businesses have peaks. A generator big enough for your busiest hour is wasted for the other twenty-three.

What it actually costs

Cloud is cheap to start and easy to overspend, because the meter never sleeps.

A machine you forgot to switch off keeps charging you. Storage you never cleared keeps charging you. Therefore many large bills are built from forgotten things rather than from heavy work.

Watch one charge in particular. Providers usually let you move data in for free and charge you to move data out. Therefore the more you store, the more it costs to leave.

At a steady, predictable size, owning your own machines can work out cheaper. Renting wins when demand jumps around, or when you cannot say how big you will be next year.

What it is bad at

No connection means no service. If your line goes down, your cloud tools go with it, so ask what your staff can still do offline.

Distance costs time, because a data centre on another continent adds delay to every request. Plan for that wait if the nearest one is far away.

Leaving is hard. Each provider has its own tools and its own names for things. Move deep enough into one and switching becomes a project rather than a decision.

A shared service also fails in a shared way. When one large cloud region has a bad day, thousands of companies have a bad day at the same moment.

Public, private and hybrid

Public cloud means you share machines with strangers, kept apart by software, and this is the cheapest and most common form.

Private cloud means the same tools, running on hardware reserved for one organisation. Banks and governments often want this, and sometimes the law tells them where the data must live.

Hybrid means both, joined together. Keep the sensitive records at home, and push the busy public website onto rented machines. Most large organisations end up here.

All three rest on one underlying trick, called virtualization. One physical machine is split into many virtual ones, so a provider can rent slices of a server to different customers.

Where you already use it

Your phone photos back up to it. Your email lives in it. A mobile money transfer is checked and recorded in it.

School portals, hospital records, ticket systems and most apps on your phone all reach a data centre somewhere. You already trust the cloud with a great deal, so it is worth knowing where that trust sits.

What to check before you move

Security in the cloud is shared. The provider guards the building, the hardware and the base software. You are responsible for your own data, your passwords and your settings. Many breaches come from the second half of that sentence.

So ask four questions before you sign. Which country will my data sit in? What will it cost to take my data out again? What can my team still do when the connection drops? And who is on duty when something breaks at two in the morning?

Then run one small thing in the cloud for a month and read the bill line by line. THE BILL TEACHES FASTER THAN THE BROCHURE.

Just Out Tech explains new research in plain language. This article was drafted with AI assistance and checked by a human against the original source.