Cloud Computing

Cloud computing is Internet-based computing, whereby shared resources, software, and information are provided to computers and other devices on demand, like the electricity grid.

In general Cloud computing customers do not own the physical infrastructure, instead avoiding capital expenditure by renting usage from a third-party provider. They consume resources as a service and pay only for resources that they use.

Amazon played a key role in the development of cloud computing by modernizing their data centers after the dot-com bubble. Cloud computing comes into focus only when you think about what IT always needs: a way to increase capacity or add capabilities on the fly without investing in new infrastructure, training new personnel, or licensing new software. Cloud computing encompasses any subscription-based or pay-per-use service that, in real time over the Internet, extends IT's existing capabilities. Today, for the most part, IT must plug into cloud-based services individually, but cloud computing aggregators and integrators are already emerging. There is a big battle for customers between Google (Google Apps) and Microsoft (MS Online). Microsoft products on the cloud include Window, Office, SQL Server, SharePoint, Exchange, Dynamics CRM.

Here's a rough breakdown of what cloud computing is all about:
1.SaaS – Software as a service
2.Utility computing
3.Web services in the cloud
4.Platform as a service
5.MSP (managed service providers)
6.Service commerce platforms
7.Internet integration

References:
http://en.wikipedia.org/wiki/Cloud_computing
http://www.microsoft.com/cloud
http://blogs.technet.com/b/cloudservicesexperts/archive/2010/06/30/two-more-customers-pick-microsoft-over-google.aspx
http://www.infoworld.com/d/cloud-computing/what-cloud-computing-really-means-031
http://www.edlconsulting.com/newsdetail.php?id=876&headline=Cloud_computing_success_requires_change_in_operations