Cloud computing has two meanings. The most common refers to running workloads remotely over the internet in a commercial provider’s data center, also known as the “public cloud” model. Popular public cloud offerings—such as Amazon Web Services (AWS), Salesforce’s CRM system, and Microsoft Azure—all exemplify this familiar notion of cloud computing. Today, most businesses take a approach, which simply means they use more than one public cloud service.

The second meaning of cloud computing describes how it works: a virtualized pool of resources, from raw compute power to application functionality, available on demand. When customers procure cloud services, the provider fulfills those requests using advanced automation rather than manual provisioning. The key advantage is agility: the ability to apply abstracted compute, storage, and network resources to workloads as needed and tap into an abundance of prebuilt services.

The public cloud lets customers gain new capabilities without investing in new hardware or software. Instead, they pay their cloud provider a subscription fee or pay for only the resources they use. Simply by filling in web forms, users can set up accounts and spin up virtual machines or provision new applications. More users or computing resources can be added on the fly—the latter in real time as workloads demand those resources thanks to a feature known as autoscaling.

Types of cloud computing defined

The array of available cloud computing services is vast, but most fall into one of the following categories.

applications for business can be found in Google’s G Suite and Microsoft’s Office 365; among enterprise applications, Salesforce leads the pack. But virtually all enterprise applications, including ERP suites from Oracle and SAP, have adopted the SaaS model. Typically, SaaS applications offer extensive configuration options as well as development environments that enable customers to code their own modifications and additions.

IaaS (infrastructure as a service)

At a basic level, public cloud providers offer storage and compute services on a pay-per-use basis. But the full array of services offered by all major public cloud providers is staggering: , virtual private networks, analytics, developer tools, , application monitoring, and so on. was the first IaaS provider and remains the leader, followed by, , and .

PaaS (platform as a service)

provides sets of services and workflows that specifically target developers, who can use shared tools, processes, and APIs to accelerate the development, testing, and deployment of applications. Salesforce’s and Force.com are popular public cloud PaaS offerings; Pivotal’s and Red Hat’s can be deployed on premises or accessed through the major public clouds. For enterprises, PaaS can ensure that developers have ready access to resources, follow certain processes, and use only a specific array of services, while operators maintain the underlying infrastructure.

FaaS (functions as a service)

FaaS, the cloud version of , adds another layer of abstraction to PaaS, so that developers are completely insulated from everything in the stack below their code. Instead of futzing with virtual servers, containers, and application runtimes, they upload narrowly functional blocks of code, and set them to be triggered by a certain event (such as a form submission or uploaded file). All the major clouds offer FaaS on top of IaaS: , , , and IBM OpenWhisk. A special benefit of FaaS applications is that they consume no IaaS resources until an event occurs, reducing pay-per-use fees.

downsizes the technologies used to run IaaS public clouds into software that can be deployed and operated in a customer’s data center. As with a public cloud, internal customers can provision their own virtual resources to build, test, and run applications, with metering to charge back departments for resource consumption. For administrators, the private cloud amounts to the ultimate in data center automation, minimizing manual provisioning and management. VMware’s Software Defined Data Center stack is the most popular commercial private cloud software, while OpenStack is the open source leader.

Note, however, that the private cloud does not fully conform to the definition of cloud computing. Cloud computing is a service. A private cloud demands that an organization build and maintain its own underlying cloud infrastructure; only internal usersof a private cloud experience it as a cloud computing service.

Hybrid cloud

A is the integration of a private cloud with a public cloud. At its most developed, the hybrid cloud involves creating parallel environments in which applications can move easily between private and public clouds. In other instances, databases may stay in the customer data center and integrate with public cloud applications—or virtualized data center workloads may be replicated to the cloud during times of peak demand. The types of integrations between private and public cloud vary widely, but they must be extensive to earn a hybrid cloud designation.

Public APIs (application programming interfaces)

Just as SaaS delivers applications to users over the internet, public offer developers application functionality that can be accessed programmatically. For example, in building web applications, developers often tap into Google Maps’s API to provide driving directions; to integrate with social media, developers may call upon APIs maintained by Twitter, Facebook, or LinkedIn. has built a successful business dedicated to delivering telephony and messaging services via public APIs. Ultimately, any business can provision its own public APIs to enable customers to consume data or access application functionality.

, although the major public clouds have proven themselves much less susceptible to attack than the average enterprise data center.

Of greater concern is the integration of security policy and identity management between customers and public cloud providers. In addition, government regulation may forbid customers from allowing sensitive data off premises. Other concerns include the risk of outages and the long-term operational costs of public cloud services.

Multicloud management

The bar to qualify as a adopter is low: A customer just needs to use more than one public cloud service. However, depending on the number and variety of cloud services involved, can become quite complex from both a cost optimization and technology perspective.

In some cases, customers subscribe to multiple cloud service simply to avoid dependence on a single provider. A more sophisticated approach is to select public clouds based on the unique services they offer and, in some cases, integrate them. For example, developers might want to use Google’s machine learning service on Google Cloud Platform to build machine-learning-enabled applications, but prefer hosted on the CloudBees platform for continuous integration.

To control costs and reduce management overhead, some customers opt for cloud management platforms (CMPs) and/or cloud service brokers (CSBs), which let you manage multiple clouds as if they were one cloud. The problem is that these solutions tend to limit customers to such common-denominator services as storage and compute, ignoring the panoply of services that make each cloud unique.

Edge computing

You often see edge computing described as an alternative to cloud computing. But it is not. to local devices in a highy distributed system, typically as a layer around a cloud computing core. There is typically a cloud involved to orchestrate all the devices and take in their data, then analyze it or otherwise act on it. 

Benefits of cloud computing

The cloud’s main appeal is to reduce the time to market of applications that need to scale dynamically. Increasingly, however, developers are drawn to the cloud by the abundance of advanced new services that can be incorporated into applications, from machine learning to internet of things (IoT) connectivity.

Although businesses sometimes migrate legacy applications to the cloud to reduce data center resource requirements, the real benefits accrue to new applications that take advantage of cloud services and “cloud native” attributes. The latter include , to enhance application portability, and container management solutions such as that orchestrate container-based services. approaches and solutions can be part of either public or private clouds and help enable highly efficient -style workflows.

Cloud computing, public or private, has become the platform of choice for large applications, particularly customer-facing ones that need to change frequently or scale dynamically. More significantly, the major public clouds now lead the way in enterprise technology development, debuting new advances before they appear anywhere else. Workload by workload, enterprises are opting for the cloud, where an endless parade of exciting new technologies invite innovative use.