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In June 2009, a study conducted by VersionOne found that 41% of senior IT professionals didn’t know what cloud computing was and two-thirds of senior finance professionals were confused by the concept. In this post, I’ll try and clear up any ambiguity about the buzz word that everyone seems to have a different definition for.

What is the Cloud?

Think of the cloud as the Internet. Cloud computing is basically a bunch of services and applications that are hosted on servers that must be accessed through the Internet. It’s basically a shift from traditional desktop applications to modern web applications.

Cloud Hosting can be broken down into 2 main categories:

- Public: like shared hosting
- Private/ Enterprise: unlimited amount of bandwidth, storage and processing power

What’s interesting about cloud hosting is that depending which services you’re using you can your own hybrid of public and private cloud hosting that will provide additional options and flexibility.

Benefits of Cloud Hosting:

Fast: Traditional business applications had the downside of having to be installed, configured, tested, run, secured and then updated regularly. With cloud hosting you need only open a browser, login and use the app directly.

Don’t need servers: All you need is an Internet connection

Don’t need storage: Everything is stored in the cloud (i.e. the Internet)

No upgrades: Upgrades are automatic

Lowered IT costs: An Aberdeen Group study found that disciplined companies achieved on average an 18% reduction in their IT budget from cloud computing and a 16% reduction in data center power costs.

Pay as you go : Subscription-based or pay-per-use service so you’re only paying for what you use.

Is it safe?

With the high-profile hacking of Google’s Gmail service and Sony’s Playstation network there have been many heated debates about the safety of storing information on the cloud. Intel has been working since the end of last year with software and computer vendors including Fujitsu, Huawei, Cisco, Dell, IBM and Hewlett Packard on a cross-industry initiative aimed at making cloud infrastructure more simplified, secure and efficient.

One of the biggest problems is the fragmented Cloud market. Intel has one cloud system, secured in its own way, Advanced Micro Devices (ARM) has another and now Apple’s iCloud will bring yet another competitor to the mix.

According to experts, there should be an open standard to follow. This would help the cloud industry to build a much securer cloud system.