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Cloud computing is about hardware-based services (involving computing, network and storage capacities), where:

  • Services are provided on-demand; customers can pay for them as they go, without the need to invest into a datacenter.
  • Hardware management is abstracted from the customers.
  • Infrastructure capacities are elastic and can easily scale up and down.

Cloud computing providers offer their services according to three fundamental models:

  1. Infrastructure as a service (IaaS).
  2. Platform as a service (PaaS),
  3. Software as a service (SaaS)

IaaS is the most basic and each higher model abstracts from the details of the lower models.

See more on Wikipedia: http://en.wikipedia.org/wiki/Cloud_computing

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