Cloud computing

Cloud computing is "a paradigm for enabling network access

to a scalable and elastic pool of shareable physical or virtual
resources with self-service provisioning and administration
on-demand," according to ISO.[1] It is commonly referred to
as "the cloud".[2]

Characteristics
In 2011, the National Institute of Standards and Technology
(NIST) identified five "essential characteristics" for cloud
systems.[3] Below are the exact definitions according to Cloud computing metaphor: the group of
NIST:[3] networked elements providing services
does not need to be addressed or
On-demand self-service: "A consumer can managed individually by users; instead,
unilaterally provision computing capabilities, such as the entire provider-managed suite of
server time and network storage, as needed hardware and software can be thought of
automatically without requiring human interaction as an amorphous cloud.
with each service provider."
Broad network access: "Capabilities are available
over the network and accessed through standard mechanisms that promote use by
heterogeneous thin or thick client platforms (e.g., mobile phones, tablets, laptops, and
workstations)."
Resource pooling: " The provider's computing resources are pooled to serve multiple
consumers using a multi-tenant model, with different physical and virtual resources
dynamically assigned and reassigned according to consumer demand."
Rapid elasticity: "Capabilities can be elastically provisioned and released, in some cases
automatically, to scale rapidly outward and inward commensurate with demand. To the
consumer, the capabilities available for provisioning often appear unlimited and can be
appropriated in any quantity at any time."
Measured service: "Cloud systems automatically control and optimize resource use by
leveraging a metering capability at some level of abstraction appropriate to the type of
service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage
can be monitored, controlled, and reported, providing transparency for both the provider and
consumer of the utilized service.
By 2023, the International Organization for Standardization (ISO) had expanded and refined the list.[4]

History
The history of cloud computing extends to the 1960s, with the initial concepts of time-sharing becoming
popularized via remote job entry (RJE). The "data center" model, where users submitted jobs to operators
to run on mainframes, was predominantly used during this era. This was a time of exploration and
experimentation with ways to make large-scale computing power available to more users through time-
sharing, optimizing the infrastructure, platform, and applications, and increasing efficiency for end
users.[5]

The "cloud" metaphor for virtualized services dates to 1994, when it was used by General Magic for the
universe of "places" that mobile agents in the Telescript environment could "go". The metaphor is
credited to David Hoffman, a General Magic communications specialist, based on its long-standing use in
networking and telecom.[6] The expression cloud computing became more widely known in 1996 when
Compaq Computer Corporation drew up a business plan for future computing and the Internet. The
company's ambition was to supercharge sales with "cloud computing-enabled applications". The business
plan foresaw that online consumer file storage would likely be commercially successful. As a result,
Compaq decided to sell server hardware to internet service providers.[7]

In the 2000s, the application of cloud computing began to take shape with the establishment of Amazon
Web Services (AWS) in 2002, which allowed developers to build applications independently. In 2006
Amazon Simple Storage Service, known as Amazon S3, and the Amazon Elastic Compute Cloud (EC2)
were released. In 2008 NASA's development of the first open-source software for deploying private and
hybrid clouds.[8][9]

The following decade saw the launch of various cloud services. In 2010, Microsoft launched Microsoft
Azure, and Rackspace Hosting and NASA initiated an open-source cloud-software project, OpenStack.
IBM introduced the IBM SmartCloud framework in 2011, and Oracle announced the Oracle Cloud in
2012. In December 2019, Amazon launched AWS Outposts, a service that extends AWS infrastructure,
services, APIs, and tools to customer data centers, co-location spaces, or on-premises facilities.[10][11]

Value proposition
Cloud computing can enable shorter time to market by providing pre-configured tools, scalable resources,
and managed services, allowing users to focus on their core business value instead of maintaining
infrastructure. Cloud platforms can enable organizations and individuals to reduce upfront capital
expenditures on physical infrastructure by shifting to an operational expenditure model, where costs scale
with usage. Cloud platforms also offer managed services and tools, such as artificial intelligence, data
analytics, and machine learning, which might otherwise require significant in-house expertise and
infrastructure investment.[12][13][14]

While cloud computing can offer cost advantages through effective resource optimization, organizations
often face challenges such as unused resources, inefficient configurations, and hidden costs without
proper oversight and governance. Many cloud platforms provide cost management tools, such as AWS
Cost Explorer and Azure Cost Management, and frameworks like FinOps have emerged to standardize
financial operations in the cloud. Cloud computing also facilitates collaboration, remote work, and global
service delivery by enabling secure access to data and applications from any location with an internet
connection.[12][13][14]

Cloud providers offer various redundancy options for core services, such as managed storage and
managed databases, though redundancy configurations often vary by service tier. Advanced redundancy
strategies, such as cross-region replication or failover systems, typically require explicit configuration and
may incur additional costs or licensing fees.[12][13][14]
Cloud environments operate under a shared responsibility model, where providers are typically
responsible for infrastructure security, physical hardware, and software updates, while customers are
accountable for data encryption, identity and access management (IAM), and application-level security.
These responsibilities vary depending on the cloud service model—Infrastructure as a Service (IaaS),
Platform as a Service (PaaS), or Software as a Service (SaaS)—with customers typically having more
control and responsibility in IaaS environments and progressively less in PaaS and SaaS models, often
trading control for convenience and managed services.[12][13][14]

Adoption and suitability

The decision to adopt cloud computing or maintain on-premises infrastructure depends on factors such as
scalability, cost structure, latency requirements, regulatory constraints, and infrastructure
customization.[15][16][17][18]

Organizations with variable or unpredictable workloads, limited capital for upfront investments, or a
focus on rapid scalability benefit from cloud adoption. Startups, SaaS companies, and e-commerce
platforms often prefer the pay-as-you-go operational expenditure (OpEx) model of cloud infrastructure.
Additionally, companies prioritizing global accessibility, remote workforce enablement, disaster recovery,
and leveraging advanced services such as AI/ML and analytics are well-suited for the cloud. In recent
years, some cloud providers have started offering specialized services for high-performance computing
and low-latency applications, addressing some use cases previously exclusive to on-premises
setups.[15][16][17][18]

On the other hand, organizations with strict regulatory requirements, highly predictable workloads, or
reliance on deeply integrated legacy systems may find cloud infrastructure less suitable. Businesses in
industries like defense, government, or those handling highly sensitive data often favor on-premises
setups for greater control and data sovereignty. Additionally, companies with ultra-low latency
requirements, such as high-frequency trading (HFT) firms, rely on custom hardware (e.g., FPGAs) and
physical proximity to exchanges, which most cloud providers cannot fully replicate despite recent
advancements. Similarly, tech giants like Google, Meta, and Amazon build their own data centers due to
economies of scale, predictable workloads, and the ability to customize hardware and network
infrastructure for optimal efficiency. However, these companies also use cloud services selectively for
certain workloads and applications where it aligns with their operational needs.[15][16][17][18]

In practice, many organizations are increasingly adopting hybrid cloud architectures, combining on-
premises infrastructure with cloud services. This approach allows businesses to balance scalability, cost-
effectiveness, and control, offering the benefits of both deployment models while mitigating their
respective limitations.[15][16][17][18]

Challenges and limitations

One of the main challenges of cloud computing, in comparison to more traditional on-premises
computing, is data security and privacy. Cloud users entrust their sensitive data to third-party providers,
who may not have adequate measures to protect it from unauthorized access, breaches, or leaks. Cloud
users also face compliance risks if they have to adhere to certain regulations or standards regarding data
protection, such as GDPR or HIPAA.[19]

Another challenge of cloud computing is reduced visibility and control. Cloud users may not have full
insight into how their cloud resources are managed, configured, or optimized by their providers. They
may also have limited ability to customize or modify their cloud services according to their specific needs
or preferences.[19] Complete understanding of all technology may be impossible, especially given the
scale, complexity, and deliberate opacity of contemporary systems; however, there is a need for
understanding complex technologies and their interconnections to have power and agency within
them.[20] The metaphor of the cloud can be seen as problematic as cloud computing retains the aura of
something noumenal and numinous; it is something experienced without precisely understanding what it
is or how it works.[21]

Additionally, cloud migration is a significant challenge. This process involves transferring data,
applications, or workloads from one cloud environment to another, or from on-premises infrastructure to
the cloud. Cloud migration can be complicated, time-consuming, and expensive, particularly when there
are compatibility issues between different cloud platforms or architectures. If not carefully planned and
executed, cloud migration can lead to downtime, reduced performance, or even data loss.[22]

Cloud migration challenges

According to the 2024 State of the Cloud Report by Flexera, approximately 50% of respondents
identified the following top challenges when migrating workloads to public clouds:[23]

1. "Understanding application dependencies"

2. "Comparing on-premise and cloud costs"
3. "Assessing technical feasibility."

Implementation challenges
Applications hosted in the cloud are susceptible to the fallacies of distributed computing, a series of
misconceptions that can lead to significant issues in software development and deployment.[24]

Cloud cost overruns

In a report by Gartner, a survey of 200 IT leaders revealed that 69% experienced budget overruns in their
organizations' cloud expenditures during 2023. Conversely, 31% of IT leaders whose organizations stayed
within budget attributed their success to accurate forecasting and budgeting, proactive monitoring of
spending, and effective optimization.[25]

The 2024 Flexera State of Cloud Report identifies the top cloud challenges as managing cloud spend,
followed by security concerns and lack of expertise. Public cloud expenditures exceeded budgeted
amounts by an average of 15%. The report also reveals that cost savings is the top cloud initiative for
60% of respondents. Furthermore, 65% measure cloud progress through cost savings, while 42%
prioritize shorter time-to-market, indicating that cloud's promise of accelerated deployment is often
overshadowed by cost concerns.[23]
Service Level Agreements
Typically, cloud providers' Service Level Agreements (SLAs) do not encompass all forms of service
interruptions. Exclusions typically include planned maintenance, downtime resulting from external
factors such as network issues, human errors, like misconfigurations, natural disasters, force majeure
events, or security breaches. Typically, customers bear the responsibility of monitoring SLA compliance
and must file claims for any unmet SLAs within a designated timeframe. Customers should be aware of
how deviations from SLAs are calculated, as these parameters may vary by service. These requirements
can place a considerable burden on customers. Additionally, SLA percentages and conditions can differ
across various services within the same provider, with some services lacking any SLA altogether. In cases
of service interruptions due to hardware failures in the cloud provider, the company typically does not
offer monetary compensation. Instead, eligible users may receive credits as outlined in the corresponding
SLA.[26][27][28][29]

Leaky abstractions
Cloud computing abstractions aim to simplify resource management, but leaky abstractions can expose
underlying complexities. These variations in abstraction quality depend on the cloud vendor, service and
architecture. Mitigating leaky abstractions requires users to understand the implementation details and
limitations of the cloud services they utilize.[30][31][32]

Service lock-in within the same vendor

Service lock-in within the same vendor occurs when a customer becomes dependent on specific services
within a cloud vendor, making it challenging to switch to alternative services within the same vendor
when their needs change.[33][34]

Security and privacy

Cloud computing poses privacy concerns because
the service provider can access the data that is in
the cloud at any time. It could accidentally or
deliberately alter or delete information.[35] Many
cloud providers can share information with third
parties if necessary for purposes of law and order
without a warrant. That is permitted in their
privacy policies, which users must agree to before
they start using cloud services. Solutions to
Cloud suppliers security and privacy agreements must
privacy include policy and legislation as well as be aligned to the demand(s) requirements and
end-users' choices for how data is stored.[35] regulations.
Users can encrypt data that is processed or stored
within the cloud to prevent unauthorized
access.[35] Identity management systems can also provide practical solutions to privacy concerns in cloud
computing. These systems distinguish between authorized and unauthorized users and determine the
amount of data that is accessible to each entity.[36] The systems work by creating and describing
identities, recording activities, and getting rid of unused identities.
According to the Cloud Security Alliance, the top three threats in the cloud are Insecure Interfaces and
APIs, Data Loss & Leakage, and Hardware Failure—which accounted for 29%, 25% and 10% of all
cloud security outages respectively. Together, these form shared technology vulnerabilities. In a cloud
provider platform being shared by different users, there may be a possibility that information belonging to
different customers resides on the same data server. Additionally, Eugene Schultz, chief technology
officer at Emagined Security, said that hackers are spending substantial time and effort looking for ways
to penetrate the cloud. "There are some real Achilles' heels in the cloud infrastructure that are making big
holes for the bad guys to get into". Because data from hundreds or thousands of companies can be stored
on large cloud servers, hackers can theoretically gain control of huge stores of information through a
single attack—a process he called "hyperjacking". Some examples of this include the Dropbox security
breach, and iCloud 2014 leak.[37] Dropbox had been breached in October 2014, having over seven
million of its users passwords stolen by hackers in an effort to get monetary value from it by Bitcoins
(BTC). By having these passwords, they are able to read private data as well as have this data be indexed
by search engines (making the information public).[37]

There is the problem of legal ownership of the data (If a user stores some data in the cloud, can the cloud
provider profit from it?). Many Terms of Service agreements are silent on the question of ownership.[38]
Physical control of the computer equipment (private cloud) is more secure than having the equipment off-
site and under someone else's control (public cloud). This delivers great incentive to public cloud
computing service providers to prioritize building and maintaining strong management of secure
services.[39] Some small businesses that do not have expertise in IT security could find that it is more
secure for them to use a public cloud. There is the risk that end users do not understand the issues
involved when signing on to a cloud service (persons sometimes do not read the many pages of the terms
of service agreement, and just click "Accept" without reading). This is important now that cloud
computing is common and required for some services to work, for example for an intelligent personal
assistant (Apple's Siri or Google Assistant). Fundamentally, private cloud is seen as more secure with
higher levels of control for the owner, however public cloud is seen to be more flexible and requires less
time and money investment from the user.[40]

The attacks that can be made on cloud computing systems include man-in-the middle attacks, phishing
attacks, authentication attacks, and malware attacks. One of the largest threats is considered to be
malware attacks, such as Trojan horses. Recent research conducted in 2022 has revealed that the Trojan
horse injection method is a serious problem with harmful impacts on cloud computing systems.[41]
Service models

Comparison of on-premise, IaaS, PaaS, and SaaS

The National Institute of Standards and Technology

recognized three cloud service models in 2011:
Infrastructure as a Service (IaaS), Platform as a
Service (PaaS), and Software as a Service (SaaS).[3]
The International Organization for Standardization
(ISO) later identified additional models in 2023,
including "Network as a Service", "Communications
as a Service", "Compute as a Service", and "Data
Storage as a Service".[4]

Infrastructure as a service (IaaS)

Infrastructure as a service (IaaS) refers to online
services that provide high-level APIs used to abstract
various low-level details of underlying network
infrastructure like physical computing resources,
location, data partitioning, scaling, security, backup,
etc. A hypervisor runs the virtual machines as guests.
Pools of hypervisors within the cloud operational Cloud computing service models arranged as
system can support large numbers of virtual machines layers in a stack
and the ability to scale services up and down
according to customers' varying requirements. Linux
containers run in isolated partitions of a single Linux kernel running directly on the physical hardware.
Linux cgroups and namespaces are the underlying Linux kernel technologies used to isolate, secure and
manage the containers. The use of containers offers higher performance than virtualization because there
is no hypervisor overhead. IaaS clouds often offer additional resources such as a virtual-machine disk-
image library, raw block storage, file or object storage, firewalls, load balancers, IP addresses, virtual
local area networks (VLANs), and software bundles.[42]

The NIST's definition of cloud computing describes IaaS as "where the consumer is able to deploy and
run arbitrary software, which can include operating systems and applications. The consumer does not
manage or control the underlying cloud infrastructure but has control over operating systems, storage, and
deployed applications; and possibly limited control of select networking components (e.g., host
firewalls)."[3]

IaaS-cloud providers supply these resources on-demand from their large pools of equipment installed in
data centers. For wide-area connectivity, customers can use either the Internet or carrier clouds (dedicated
virtual private networks). To deploy their applications, cloud users install operating-system images and
their application software on the cloud infrastructure. In this model, the cloud user patches and maintains
the operating systems and the application software. Cloud providers typically bill IaaS services on a
utility computing basis: cost reflects the number of resources allocated and consumed.[43]

Platform as a service (PaaS)

The NIST's definition of cloud computing defines Platform as a Service as:[3]

The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-
created or acquired applications created using programming languages, libraries, services, and
tools supported by the provider. The consumer does not manage or control the underlying cloud
infrastructure including network, servers, operating systems, or storage, but has control over the
deployed applications and possibly configuration settings for the application-hosting
environment.

PaaS vendors offer a development environment to application developers. The provider typically
develops toolkit and standards for development and channels for distribution and payment. In the PaaS
models, cloud providers deliver a computing platform, typically including an operating system,
programming-language execution environment, database, and the web server. Application developers
develop and run their software on a cloud platform instead of directly buying and managing the
underlying hardware and software layers. With some PaaS, the underlying computer and storage
resources scale automatically to match application demand so that the cloud user does not have to allocate
resources manually.[44]

Some integration and data management providers also use specialized applications of PaaS as delivery
models for data. Examples include iPaaS (Integration Platform as a Service) and dPaaS (Data
Platform as a Service). iPaaS enables customers to develop, execute and govern integration flows.[45]
Under the iPaaS integration model, customers drive the development and deployment of integrations
without installing or managing any hardware or middleware.[46] dPaaS delivers integration—and data-
management—products as a fully managed service.[47] Under the dPaaS model, the PaaS provider, not
the customer, manages the development and execution of programs by building data applications for the
customer. dPaaS users access data through data-visualization tools.[48]
Software as a service (SaaS)
The NIST's definition of cloud computing defines Software as a Service as:[3]

The capability provided to the consumer is to use the provider's applications running on a cloud
infrastructure. The applications are accessible from various client devices through either a thin
client interface, such as a web browser (e.g., web-based email), or a program interface. The
consumer does not manage or control the underlying cloud infrastructure including network,
servers, operating systems, storage, or even individual application capabilities, with the
possible exception of limited user-specific application configuration settings.

In the software as a service (SaaS) model, users gain access to application software and databases. Cloud
providers manage the infrastructure and platforms that run the applications. SaaS is sometimes referred to
as "on-demand software" and is usually priced on a pay-per-use basis or using a subscription fee.[49] In
the SaaS model, cloud providers install and operate application software in the cloud and cloud users
access the software from cloud clients. Cloud users do not manage the cloud infrastructure and platform
where the application runs. This eliminates the need to install and run the application on the cloud user's
own computers, which simplifies maintenance and support. Cloud applications differ from other
applications in their scalability—which can be achieved by cloning tasks onto multiple virtual machines
at run-time to meet changing work demand.[50] Load balancers distribute the work over the set of virtual
machines. This process is transparent to the cloud user, who sees only a single access-point. To
accommodate a large number of cloud users, cloud applications can be multitenant, meaning that any
machine may serve more than one cloud-user organization.

The pricing model for SaaS applications is typically a monthly or yearly flat fee per user,[51] so prices
become scalable and adjustable if users are added or removed at any point. It may also be free.[52]
Proponents claim that SaaS gives a business the potential to reduce IT operational costs by outsourcing
hardware and software maintenance and support to the cloud provider. This enables the business to
reallocate IT operations costs away from hardware/software spending and from personnel expenses,
towards meeting other goals. In addition, with applications hosted centrally, updates can be released
without the need for users to install new software. One drawback of SaaS comes with storing the users'
data on the cloud provider's server. As a result, there could be unauthorized access to the data.[53]
Examples of applications offered as SaaS are games and productivity software like Google Docs and
Office Online. SaaS applications may be integrated with cloud storage or File hosting services, which is
the case with Google Docs being integrated with Google Drive, and Office Online being integrated with
OneDrive.[54]

Serverless computing
Serverless computing allows customers to use various cloud capabilities without the need to provision,
deploy, or manage hardware or software resources, apart from providing their application code or data.
ISO/IEC 22123-2:2023 classifies serverless alongside Infrastructure as a Service (IaaS), Platform as a
Service (PaaS), and Software as a Service (SaaS) under the broader category of cloud service categories.
Notably, while ISO refers to these classifications as cloud service categories, the National Institute of
Standards and Technology (NIST) refers to them as service models.[3][4]
Deployment models
"A cloud deployment model represents
the way in which cloud computing can
be organized based on the control and
sharing of physical or virtual
resources."[4] Cloud deployment
models define the fundamental patterns
of interaction between cloud customers
and cloud providers. They do not detail
implementation specifics or the
configuration of resources.[4]

Private Cloud computing types

Private cloud is cloud infrastructure

operated solely for a single organization, whether managed internally or by a third party, and hosted
either internally or externally.[3] Undertaking a private cloud project requires significant engagement to
virtualize the business environment, and requires the organization to reevaluate decisions about existing
resources. It can improve business, but every step in the project raises security issues that must be
addressed to prevent serious vulnerabilities. Self-run data centers[55] are generally capital intensive. They
have a significant physical footprint, requiring allocations of space, hardware, and environmental
controls. These assets have to be refreshed periodically, resulting in additional capital expenditures. They
have attracted criticism because users "still have to buy, build, and manage them" and thus do not benefit
from less hands-on management,[56] essentially "[lacking] the economic model that makes cloud
computing such an intriguing concept".[57][58]

Public
Cloud services are considered "public" when they are delivered over the public Internet, and they may be
offered as a paid subscription, or free of charge.[59] Architecturally, there are few differences between
public- and private-cloud services, but security concerns increase substantially when services
(applications, storage, and other resources) are shared by multiple customers. Most public-cloud
providers offer direct-connection services that allow customers to securely link their legacy data centers
to their cloud-resident applications.[60][61]

Several factors like the functionality of the solutions, cost, integrational and organizational aspects as
well as safety & security are influencing the decision of enterprises and organizations to choose a public
cloud or on-premises solution.[62]

Hybrid
Hybrid cloud is a composition of a public cloud and a private environment, such as a private cloud or on-
premises resources,[63][64] that remain distinct entities but are bound together, offering the benefits of
multiple deployment models. Hybrid cloud can also mean the ability to connect collocation, managed
and/or dedicated services with cloud resources.[3] Gartner defines a hybrid cloud service as a cloud
computing service that is composed of some combination of private, public and community cloud
services, from different service providers.[65] A hybrid cloud service crosses isolation and provider
boundaries so that it cannot be simply put in one category of private, public, or community cloud service.
It allows one to extend either the capacity or the capability of a cloud service, by aggregation, integration
or customization with another cloud service.

Varied use cases for hybrid cloud composition exist. For example, an organization may store sensitive
client data in house on a private cloud application, but interconnect that application to a business
intelligence application provided on a public cloud as a software service.[66] This example of hybrid
cloud extends the capabilities of the enterprise to deliver a specific business service through the addition
of externally available public cloud services. Hybrid cloud adoption depends on a number of factors such
as data security and compliance requirements, level of control needed over data, and the applications an
organization uses.[67]

Another example of hybrid cloud is one where IT organizations use public cloud computing resources to
meet temporary capacity needs that can not be met by the private cloud.[68] This capability enables hybrid
clouds to employ cloud bursting for scaling across clouds.[3] Cloud bursting is an application deployment
model in which an application runs in a private cloud or data center and "bursts" to a public cloud when
the demand for computing capacity increases. A primary advantage of cloud bursting and a hybrid cloud
model is that an organization pays for extra compute resources only when they are needed.[69] Cloud
bursting enables data centers to create an in-house IT infrastructure that supports average workloads, and
use cloud resources from public or private clouds, during spikes in processing demands.[70]

Community
Community cloud shares infrastructure between several organizations from a specific community with
common concerns (security, compliance, jurisdiction, etc.), whether it is managed internally or by a third-
party, and hosted internally or externally, the costs are distributed among fewer users compared to a
public cloud (but more than a private cloud). As a result, only a portion of the potential cost savings of
cloud computing is achieved. [3]

Multi cloud
According to ISO/IEC 22123-1: "multi-cloud is a cloud deployment model in which a customer uses
public cloud services provided by two or more cloud service providers". [71] Poly cloud refers to the use
of multiple public clouds for the purpose of leveraging specific services that each provider offers. It
differs from Multi cloud in that it is not designed to increase flexibility or mitigate against failures but is
rather used to allow an organization to achieve more than could be done with a single provider.[72]

Market
According to International Data Corporation (IDC), global spending on cloud computing services has
reached $706 billion and is expected to reach $1.3 trillion by 2025.[73] Gartner estimated that global
public cloud services end-user spending would reach $600 billion by 2023.[74] According to a McKinsey
& Company report, cloud cost-optimization levers and value-oriented business use cases foresee more
than $1 trillion in run-rate EBITDA across Fortune 500 companies as up for grabs in 2030.[75] In 2022,
more than $1.3 trillion in enterprise IT spending was at stake from the shift to the cloud, growing to
almost $1.8 trillion in 2025, according to Gartner.[76]

The European Commission's 2012 Communication identified several issues which were impeding the
development of the cloud computing market:[77]: Section 3

fragmentation of the digital single market across the EU

concerns about contracts including reservations about data access and ownership, data
portability, and change control
variations in standards applicable to cloud computing
The Communication set out a series of "digital agenda actions" which the Commission proposed to
undertake in order to support the development of a fair and effective market for cloud computing
services.[77]: Pages 6–14

Cloud Computing Vendors

As of 2025, the three largest cloud computing providers by market share, commonly referred to as
hyperscalers, are Amazon Web Services (AWS), Microsoft Azure, and Google Cloud.[78][79] These
companies dominate the global cloud market due to their extensive infrastructure, broad service offerings,
and scalability.

In recent years, organizations have increasingly adopted alternative cloud providers, which offer
specialized services that distinguish them from hyperscalers. These providers may offer advantages such
as lower costs, improved cost transparency and predictability, enhanced data sovereignty (particularly
within regions such as the European Union to comply with regulations like the General Data Protection
Regulation (GDPR)), stronger alignment with local regulatory requirements, or industry-specific
services.[80]

Alternative cloud providers are often part of multi-cloud strategies, where organizations use multiple
cloud services—both from hyperscalers and specialized providers—to optimize performance,
compliance, and cost efficiency. However, they do not necessarily serve as direct replacements for
hyperscalers, as their offerings are typically more specialized.[80]

Similar concepts
The goal of cloud computing is to allow users to take benefit from all of these technologies, without the
need for deep knowledge about or expertise with each one of them. The cloud aims to cut costs and helps
the users focus on their core business instead of being impeded by IT obstacles.[81] The main enabling
technology for cloud computing is virtualization. Virtualization software separates a physical computing
device into one or more "virtual" devices, each of which can be easily used and managed to perform
computing tasks. With operating system–level virtualization essentially creating a scalable system of
multiple independent computing devices, idle computing resources can be allocated and used more
efficiently. Virtualization provides the agility required to speed up IT operations and reduces cost by
increasing infrastructure utilization. Autonomic computing automates the process through which the user
can provision resources on-demand. By minimizing user involvement, automation speeds up the process,
reduces labor costs and reduces the possibility of human errors.[81]

Cloud computing uses concepts from utility computing to provide metrics for the services used. Cloud
computing attempts to address QoS (quality of service) and reliability problems of other grid computing
models.[81]

Cloud computing shares characteristics with:

Client–server model – Client–server computing refers broadly to any distributed application

that distinguishes between service providers (servers) and service requestors (clients).[82]
Computer bureau – A service bureau providing computer services, particularly from the
1960s to 1980s.
Grid computing – A form of distributed and parallel computing, whereby a 'super and virtual
computer' is composed of a cluster of networked, loosely coupled computers acting in
concert to perform very large tasks.
Fog computing – Distributed computing paradigm that provides data, compute, storage and
application services closer to the client or near-user edge devices, such as network routers.
Furthermore, fog computing handles data at the network level, on smart devices and on the
end-user client-side (e.g. mobile devices), instead of sending data to a remote location for
processing.
Utility computing – The "packaging of computing resources, such as computation and
storage, as a metered service similar to a traditional public utility, such as electricity."[83][84]
Peer-to-peer – A distributed architecture without the need for central coordination.
Participants are both suppliers and consumers of resources (in contrast to the traditional
client-server model).
Cloud sandbox – A live, isolated computer environment in which a program, code or file can
run without affecting the application in which it runs.

See also
Block-level storage Cloudlet
Browser-based computing Computer cluster
Category:Cloud computing providers Cooperative storage cloud
Category:Cloud platforms Decentralized computing
Cloud computing architecture Desktop virtualization
Cloud broker Dew computing
Cloud collaboration Directory
Cloud-computing comparison Distributed data store
Cloud computing security Distributed database
Cloud gaming Distributed computing
Cloud management Distributed networking
Cloud-native computing e-Science
Cloud research Edge computing
Cloud robotics Edge device
Cloud storage Exchange-traded fund
Cloud-to-cloud integration
 File system Knowledge as a service
Clustered file system Microservices
Distributed file system Mobile cloud computing
Distributed file system for cloud Multi-access edge computing
Fog computing Multisite cloud
Fog robotics Peer-to-peer
Green computing (environmentally Personal cloud
sustainable computing) Private cloud computing infrastructure
Grid computing Robot as a service
In-memory database Service-oriented architecture
In-memory processing Time-sharing
Internet of things Ubiquitous computing
IoT security device Virtual private cloud

Notes

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Further reading
Millard, Christopher (2013). Cloud Computing Law ([Link]
t/cloud-computing-law-9780198716662?cc=gb&lang=en&). Oxford University Press.
ISBN 978-0-19-967168-7.
Weisser, Alexander (2020). International Taxation of Cloud Computing ([Link]
[Link]/unige:142710). Editions Juridiques Libres, ISBN 978-2-88954-030-3.
Singh, Jatinder; Powles, Julia; Pasquier, Thomas; Bacon, Jean (July 2015). "Data Flow
Management and Compliance in Cloud Computing" ([Link]
e/1810/255049). IEEE Cloud Computing. 2 (4): 24–32. doi:10.1109/MCC.2015.69 ([Link]
[Link]/10.1109%2FMCC.2015.69). S2CID 9812531 ([Link]
D:9812531).
Armbrust, Michael; Stoica, Ion; Zaharia, Matei; Fox, Armando; Griffith, Rean; Joseph,
Anthony D.; Katz, Randy; Konwinski, Andy; Lee, Gunho; Patterson, David; Rabkin, Ariel (1
April 2010). "A view of cloud computing" ([Link]
Communications of the ACM. 53 (4): 50. doi:10.1145/1721654.1721672 ([Link]
145%2F1721654.1721672). S2CID 1673644 ([Link]
3644).
Hu, Tung-Hui (2015). A Prehistory of the Cloud. MIT Press. ISBN 978-0-262-02951-3.
Mell, P. (2011, September). The NIST Definition of Cloud Computing ([Link]
lications/nistpubs/800-145/[Link]). Retrieved November 1, 2015, from National
Institute of Standards and Technology website

Media related to Cloud computing at Wikimedia Commons

Retrieved from "[Link]