Cloud Computing.

What Is Cloud Computing? How the Cloud Works

Cloud Computing 101

Simply put, cloud computing is when computing services are stored and accessed over the internet instead of through physical hard drives. Our guide will walk you through what cloud computing it is, how it works and how it’s being used today.

Cloud Computing Overview
Uses of Cloud Computing
Cloud Computing Overview
cloud surrounded by gears and digital numbers to represesnt cloud computing

What Is Cloud Computing?

Cloud computing refers to any kind of hosted service delivered over the internet. These services often include servers, databases, software, networks, analytics and other computing functions that can be operated through the cloud.

Files and programs stored in the cloud can be accessed anywhere by users on the service, eliminating the need to always be near physical hardware. In the past, for example, user-created documents and spreadsheets had to be saved to a physical hard drive, USB drive or disk. Without some kind of hardware component, the files were completely inaccessible outside the computer they originated on. Thanks to cloud storage, few people worry anymore about fried hard drives or lost or corrupted USB drives. Cloud computing makes the documents available everywhere because the data actually lives on a network of hosted servers that transmit data over the internet.

What Is Cloud Computing?

Cloud computing is a hosted service delivered over the internet that allows users to access files and programs anywhere, eliminating the need to always be near physical hardware.


Cloud Computing Service Types

Cloud computing services are broken down into three major categories: software-as-a-service (SaaS), platform-as-a-service (PaaS) and infrastructure-as-a-service (IaaS).


SaaS is the most common cloud service type. Many of us use it on a daily basis. The SaaS model makes software accessible through an app or web browser. Some SaaS programs are free, but many require a monthly or annual subscription to maintain the service. Requiring no hardware installation or management, SaaS solutions are a big hit in the business world. Notable examples include Salesforce, Dropbox and Google Docs.


PaaS is a cloud environment supporting web application development and deployment. PaaS supports the full lifecycle of applications, helping users build, test, deploy, manage and update all in one place. The service also includes development tools, middleware and business intelligence solutions. Notable examples include Windows Azure, AWS Elastic Beanstalk and Google App Engine.


IaaS provides users with basic computer infrastructure capabilities like data storage, servers and hardware — all in the cloud. IaaS gives businesses access to large platforms and applications without the need for large onsite physical infrastructures. Notable examples of IaaS include DigitalOcean, Amazon EC2 and Google Compute Engine.

Related Reading25 Top IaaS Providers and Companies to Know


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Benefits of Cloud Computing

There’s lots to be gained from cloud computing. In an increasingly remote world, one of the cloud’s big draws is that it allows for business operations to continue regardless of location. A report from Grand View Research highlighted the transition to remote work models as a significant driver of growth in the U.S. cloud computing market, which is projected to see a compound annual growth rate of 15.7 percent from 2022 to 2030.

Cloud storage also comes with a number of other benefits. Business leaders have reported the top benefits of cloud computing to be increased efficiency, faster deployment, collaboration tools, security and remote accessibility, according to Statista.


How Does Cloud Computing Work?

The cloud is basically a decentralized place to share information through satellite networks. Every cloud application has a host, and the hosting company is responsible for maintaining the massive data centers that provide the security, storage capacity and computing power needed to maintain all of the information users send to the cloud.

How Cloud Computing Works

Cloud computing works by having companies host or maintain massive data centers that provide the security, storage capacity and computing power to support cloud infrastructure. Clients pay for the rights to use their clouds along with an ecosystem to communicate between devices and programs.

These hosting companies can sell the rights to use their clouds and store data on their networks, while also offering the end user an ecosystem that can communicate between devices and programs (for example, download a song on your laptop and it’s instantly synced to the music app on your iPhone).

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Types of Cloud Computing Delivery Models


Public Cloud

This is the most common and all of the players in cloud computing (Amazon, Microsoft, Apple and Google) run public clouds accessible anywhere with login credentials and the right web app.

Private Cloud

This model offers the same kind of flexibility as the public cloud, but with the infrastructure needs (hosting, data storage, IT staff, etc.) provided by the companies or users of the service. Additionally, the restricted access and hands-on management of hosting gives the private model an extra layer of security.

Hybrid Cloud

Hybrid cloud computing is a combination of the public and private models. The two cloud types are linked over the internet and can share resources when needed (for example, if the private cloud reaches storage capacity or becomes corrupted, the public cloud can step in and save the day).

Related Reading15 Cloud Storage Companies Handling Our Data

Uses of Cloud Computing

Companies and individuals use cloud computing in a variety of unique and exciting ways. The Cloud Infrastructure Report 2021 from cloud management company CloudCheckr revealed close to 60 percent of the 304 IT and business stakeholders surveyed said they had more than half their infrastructure already in the cloud.

The most prominent companies hosting the cloud are major players like Amazon (Amazon Web Services), Microsoft (Azure), Apple (iCloud) and Google (Google Drive), but there’s also a bunch of other players, large and small.

What Are Cloud Companies?

Cloud companies, sometimes called Cloud Service Providers (CSPs), offer services or applications on the cloud. They host tools and data centers that allow customers to retrieve and utilize information in a flexible, manageable and cost-effective manner. Customers can easily access their cloud-based data via any network connection.

Among the most common applications of cloud computing people might encounter both at work and in their everyday lives are cloud-based collaboration tools like Microsoft OneDrive and Dropbox, movie and music streaming and backup storage for iPhones and other mobile devices.

In addition to some of the examples already covered, here is a quick look at some other important application areas.

Cloud Computing Applications

  • Communication and collaboration
  • Media streaming
  • Big data analytics and insights
  • Streamlining business processes
  • Storage backups and data recovery


Communication and Collaboration

The entire Google suite of applications is cloud-based, from calendar to Google Chat. Additionally, so are popular apps like Zoom and WhatsApp, and all empower people to communicate and collaborate on a global scale.


A combination of cloud computing and vastly improved internet speed has given rise to media streaming giants like Netflix and Hulu, which host enormous databases of movies and TV shows available via the cloud. Cloud storage allows these companies and others like Spotify and Tidal, to exist.

Big Data Analytics

Before the cloud, using big data to glean patterns and insights was a cumbersome and expensive process. The cloud has changed all that, eliminating the need for in-house development resources when compiling and analyzing data. Nowadays companies can collect data from a variety of sources, connect them to the cloud and dig for insights in real time.

Business Processes

Without the cloud, innovative tools like Salesforce, Slack and myriad others designed to enhance and streamline the daily operations of companies would not exist.

Storage Backups

Cloud computing is an important answer to the issue of data-loss and recovery on physical hard drives. Most individuals who’ve owned a computer have experienced the stress of losing irreplaceable files. Whether it’s a term paper, family photos or the company payroll, cloud storage offers an easily accessible backup solution to keep data safe.

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