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Cloud computing - we hear the term almost daily. But really, just what is cloud computing all about? That seems to be a common question. In June of this year, TELUS and IDC Canada released a study on cloud computing which surveyed 200 Canadian business and IT executives and directors at large Canadian companies (500+ employees) across a range of industry sectors. The study found that 63% of Canadian companies surveyed did not have enough or had only a base level of knowledge to make decisions on whether to use a cloud service or their internal IT department.

A recent article from eweek.com also indicates that there is a great deal of confusion about cloud computing. The article makes reference to a recent study commissioned by Citrix Systems which included more than 1000 adults in the U.S. The study showed that most respondents thought that the cloud is related to weather. 51% of respondents thought that the weather could interfere with cloud computing. Despite the confusion, the study also found that 97% of participants are using cloud services today with examples including on-line banking, shopping, social networks and file sharing. Further, 59% of respondents indicated that they believe that the "workplace of the future" will be in the cloud which is somewhat contradictory to the prevalence of cloud computing today.

This insight above mirrors what we find amongst our own clients. Knowledge of cloud computing is relatively limited and as a result, organizations may be missing out on significant opportunities to make their business stronger by reducing cost and risk. Our hope is that this article provides insight into cloud computing to help you to assess its fit for your business requirements.

What is cloud computing?

First of all, it's useful to understand where the term cloud computing came from. It most likely originated from the use of a cloud image to represent a networked computing environment or the internet.

A quick Google search will reveal a number of definitions for cloud computing. I like a definition I picked up from Wikipedia which defines cloud computing as the delivery of computing as a service whereby shared resources, software and information are provided to computers and other devices as a utility, similar to the electricity grid, over a network which is most often the internet.

What are the various cloud computing models?

To sort out some of the confusion around cloud computing, it is helpful to understand the various cloud service models, of which there are three - software as a service (SaaS), platform as a service (PaaS) and infrastructure as a service (IaaS).

SaaS is the most widely known flavour of cloud service. SaaS is sometimes referred to as on demand software. With SaaS, software and its associated data are centrally hosted and are typically accessed over the internet using a browser. What are some examples of SaaS? MailChimp, the application we use to distribute our newsletters, is an example. Google Apps is another example as is Dropbox, and the list continues to expand.

PaaS provides the delivery of a computing platform and required solutions to facilitate the deployment of applications without having to invest in the cost and complexity of hardware and software. Some examples of PaaS include Microsoft Azure and Google's App Engine.

The IaaS service model allows clients to avoid the procurement of servers, software, data centre space and network equipment. Such resources are provided as a fully outsourced service. Examples of IaaS include Amazon's Elastic Compute Cloud and Rackspace.

In addition to the various cloud service models, it's useful to understand the delivery models through which cloud computing is distributed. The main delivery models include public, private, community and hybrid.

A public cloud offers infrastructure and solutions to the general public and is typically owned by a large organization that sells cloud services.

A private cloud is designed solely for one organization. A private cloud may be managed by the organization which uses it, or by a third party, and the infrastructure may be located on the site of the cloud user or elsewhere.

A community cloud is shared by several organizations and supports a community of users, usually with some common interest, such as regulatory concerns.

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