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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]

Essential Characteristics
In 2011, the National Institute of Standards and Technology (NIST)
identified five "essential characteristics" for cloud systems.[2] Below are
the exact definitions according to NIST:[2] Cloud computing metaphor: the
group of networked elements
On-demand self-service: "A consumer can unilaterally providing services does not need to
provision computing capabilities, such as server time and be addressed or managed
network storage, as needed automatically without requiring individually by users; instead, the
human interaction with each service provider." entire provider-managed suite of
Broad network access: "Capabilities are available over the hardware and software can be
network and accessed through standard mechanisms that thought of as an amorphous cloud.
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.[3]

History
The history of cloud computing extends back 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.[4]

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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.[5] 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.[6]

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.[7][8]

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.[9][10]

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.[11][12][13]

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.[11][12][13]

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.[11][12][13]

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

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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.[11][12][13]

Factors influencing the adoption and suitability of cloud computing

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.[14][15][16][17]

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.[14][15][16][17]

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.[14][15][16][17]

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.[14][15][16][17]

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.[18]

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.[18]
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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.[19] 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.[20]

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.[21]

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:[22]

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.[23]

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.[24]

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.[22]

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

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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.[25][26][27][28]

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.[29][30][31]

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.[32][33]

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.[34] 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 privacy
include policy and legislation as well as end-users'
Cloud suppliers security and privacy agreements must
choices for how data is stored.[34] Users can encrypt data be aligned to the demand(s) requirements and
that is processed or stored within the cloud to prevent regulations.
unauthorized access. [34]
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.[35] 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
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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.[36] 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).[36]

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.[37]
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.[38] 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.[39]

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.[40]

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).[2] The
International Organization for Standardization (ISO) later identified additional models in 2023, including

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"Network as a Service", "Communications as a Service",

"Compute as a Service", and "Data Storage as a Service".[3]

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 system can support large numbers of virtual
machines 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 Cloud computing service models arranged as
than virtualization because there is no hypervisor overhead. layers in a stack
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.[41]

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)."[2]

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.[42]

Platform as a service (PaaS)

The NIST's definition of cloud computing defines Platform as a Service as:[2]

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.

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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.[43]

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.[44] Under the iPaaS
integration model, customers drive the development and deployment of integrations without installing or
managing any hardware or middleware.[45] dPaaS delivers integration—and data-management—products as a
fully managed service.[46] 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.[47]

Software as a service (SaaS)

The NIST's definition of cloud computing defines Software as a Service as:[2]

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.[48] 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.[49] 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,[50] so prices become
scalable and adjustable if users are added or removed at any point. It may also be free.[51] 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

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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.[52] 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.[53]

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.[2][3]

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."[3] 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.[3]

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.[2] 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[54] 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,[55] essentially "[lacking] the economic model that makes cloud
computing such an intriguing concept".[56][57]

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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.[58] 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.[59][60]

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.[61]

Hybrid
Hybrid cloud is a composition of a public cloud and a private environment, such as a private cloud or on-
premises resources,[62][63] 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.[2] 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.[64] 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.[65] 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.[66]

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.[67] This capability enables hybrid clouds to
employ cloud bursting for scaling across clouds.[2] 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.[68] 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.[69]

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. [2]

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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". [70] 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.[71]

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.[72] Gartner estimated that global public cloud
services end-user spending would reach $600 billion by 2023.[73] 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.[74] 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.[75]

The European Commission's 2012 Communication identified several issues which were impeding the
development of the cloud computing market:[76]: 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.[76]: 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.[77][78] 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.[79]

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.[79]

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Alternative Cloud Providers

Several alternative cloud providers offer specialized services that differentiate them from hyperscalers.

CoreWeave – Specializes in high-performance computing and GPU-accelerated workloads, often

used for AI, graphics rendering, and scientific simulations.[80][81][82]
Scaleway - – A French cloud provider offering infrastructure-as-a-service (IaaS) solutions, with a
focus on GDPR compliance and regional data sovereignty.[83][84]
MongoDB Atlas is a fully managed database-as-a-service (DBaaS) that allows users to deploy
and operate MongoDB databases on Amazon Web Services (AWS), Microsoft Azure, and Google
Cloud.[85]
OVHcloud (https://www.ovhcloud.com) – A France-based cloud provider known for its emphasis
on data sovereignty, offering private cloud, dedicated servers, and European-hosted cloud
solutions. [86][87]
Lambda Labs (https://lambda.ai) – Provides GPU cloud computing tailored for AI research, deep
learning, and machine learning development.[88][89][90][91]
Paperspace (https://www.paperspace.com/) – Specializes in cloud computing solutions for AI and
machine learning, with a focus on scalable GPU access. [92][93]
RunPod (https://www.runpod.io/) – Offers cloud computing infrastructure optimized for AI
applications and model deployment. [94][95][96]

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.[97] 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.[97]

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.[97]

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).[98]
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.
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15/04/2025, 15:09 Cloud computing - Wikipedia

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."[99][100]
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 Edge computing
Browser-based computing Edge device
Category:Cloud computing providers File system
Category:Cloud platforms Clustered file system
Cloud computing architecture Distributed file system
Cloud broker Distributed file system for cloud
Cloud collaboration Fog computing
Cloud-computing comparison Fog robotics
Cloud computing security Green computing (environmentally
Cloud gaming sustainable computing)
Cloud management Grid computing
Cloud-native computing In-memory database
Cloud research In-memory processing
Cloud robotics Internet of things
Cloud storage IoT security device
Cloud-to-cloud integration Knowledge as a service
Cloudlet Microservices
Computer cluster Mobile cloud computing
Cooperative storage cloud Multi-access edge computing
Decentralized computing Multisite cloud
Desktop virtualization Peer-to-peer
Dew computing Personal cloud
Directory Private cloud computing infrastructure
Distributed data store Robot as a service
Distributed database Service-oriented architecture
Distributed computing Time-sharing
Distributed networking Ubiquitous computing
e-Science Virtual private cloud

Notes

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Further reading
Millard, Christopher (2013). Cloud Computing Law (https://global.oup.com/academic/product/clou
d-computing-law-9780198716662?cc=gb&lang=en&). Oxford University Press. ISBN 978-0-19-
967168-7.
Weisser, Alexander (2020). International Taxation of Cloud Computing (https://archive-ouverte.uni
ge.ch/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" (https://www.repository.cam.ac.uk/handle/181
0/255049). IEEE Cloud Computing. 2 (4): 24–32. doi:10.1109/MCC.2015.69 (https://doi.org/10.110
9%2FMCC.2015.69). S2CID 9812531 (https://api.semanticscholar.org/CorpusID: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" (https://doi.org/10.1145%2F1721654.1721672). Communications of the ACM.
53 (4): 50. doi:10.1145/1721654.1721672 (https://doi.org/10.1145%2F1721654.1721672).
S2CID 1673644 (https://api.semanticscholar.org/CorpusID:1673644).
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 (http://csrc.nist.gov/publicatio
ns/nistpubs/800-145/SP800-145.pdf). Retrieved November 1, 2015, from National Institute of
Standards and Technology website
Media related to Cloud computing at Wikimedia Commons

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