A Short Answer

In June 2011, Apple announced its iCloud service. One of the eye-catching features is its digital rights management of music content. The other part is its ability to let you essentially carry your entire computer hard drive with you anywhere and stream music to any device.

Cloud is more than just storage. For example, in the same month, Google introduced ChromeBook, a “cloud laptop” that is basically just a web browser with Internet connectivity, and all the processing, storage, and software are somewhere in Google servers that you access remotely.

These new services and electronics intensify the trends that started with web-based emails (e.g., Gmail), software (e.g., Microsoft Office 365), and documents (e.g., Google Docs and Dropbox), where consumers use the network as their computers, the ultimate version of online computing.

In the enterprise market, many application providers and corporations have also shifted to cloud services, running their applications and software in rented and shared resources in data centers, rather than building their own server farms. Data centers are facilities hosting many servers and connecting them via many switches. Large data centers today is typically over 300,000 square feet, house half a million servers, and cost hundreds of millions of dollars to build.

There are three major cloud providers as of 2012: Amazon's EC2, Microsoft's Azure, and Google's AppEngine. A pioneering player in cloud services is actually Amazon, even though to most consumers Amazon stands for an online retail store.