Cloud computing basically involves in delivering hosted services over the Internet. This is basically used in IT sector now days. This new IT delivery model can significantly reduce enterprise IT costs & complexities while improving workload optimization and service delivery. This method is massively scalable, provides a superior user experience, and is characterized by new, internet-driven economics.

The word cloud has been used here as a metaphor for internet and attaching it with the computing means getting it bigger and interconnected. Some analysts and vendors define cloud computing narrowly as an updated version of utility computing: basically virtual servers available over the Internet. Others go very broad, arguing anything you consume outside the firewall is “in the cloud,” including conventional outsourcing.

This method has some distinct features that differentiate it from traditional hosting. It is sold on demand, typically by the minute or the hour; it is elastic — a user can have as much or as little of a service as they want at any given time; and the service is fully managed by the provider (the consumer/end user needs nothing but a personal computer and Internet access). This method extract employee’s potential with world-class social networking services and on-line collaboration tools including file sharing, web conferencing and instant messaging. It enables the entire enterprise with secure, cloud-based service for e-mail, scheduling and contact management.

Cloud computing can be private or public. A public cloud sells services to anyone on the Internet. (Currently, Amazon Web Services is the largest public cloud provider.) A private cloud is a proprietary network or a data center that supplies hosted services to a limited number of people. When a service provider uses public cloud resources to create their private cloud, the result is called a virtual private cloud. Private or public, the goal of cloud computing is to provide easy, scalable access to computing resources and IT services.

These services are broadly divided into three categories:
* Infrastructure-as-a-Service (IaaS)
* Platform-as-a-Service (PaaS)
* Software-as-a-Service (SaaS).

Infrastructure-as-a-Service like Amazon Web Services provides virtual server instances with unique IP addresses and blocks of storage on demand. Customers use the provider’s application program interface (API) to start, stop, access and configure their virtual servers and storage. In the enterprise, cloud computing allows a company to pay for only as much capacity as is needed, and bring more online as soon as required. Because this pay-for-what-you-use model resembles the way electricity, fuel and water are consumed; it’s sometimes referred to as utility computing.  Accelerate your application development and test efforts with this security-rich, cloud-based enterprise development environment on the Cloud. This infrastructure as a service (IaaS) solution can help you reduce costs, shorten cycle times and improve quality as well as productivity.

Platform-as-a-service in the cloud is defined as a set of software and product development tools hosted on the provider’s infrastructure. Developers create applications on the provider’s platform over the Internet. PaaS providers may use APIs, website portals or gateway software installed on the customer’s computer. Force.com, (an outgrowth of Salesforce.com) and GoogleApps are examples of PaaS.

In Software-as-a-service cloud model, the vendor supplies the hardware infrastructure, the software product and interacts with the user through a front-end portal. SaaS is a very broad market. Services can range from Web-based email to inventory control and database processing. Because the service provider hosts both the application and the data, the end user is free to use the service from anywhere.

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