The cloud causes a great deal of confusion.

There is little consensus over what the term really describes. Data centre vendors will tell you how you can buy storage from the cloud, with servers switched on and off effortlessly and remotely. Software vendors will tell you that it is all about access to centralised software via the web, allowing you to use complex software without installing or maintaining a single package. Security vendors will tell you that it is an accident waiting to happen.

In many ways, the cloud is really a bit like the computer system represented in Hollywood blockbuster 'the matrix' – though without the Neo sunglasses.

The concept is that services should be accessible remotely without the customer needing to understand or care about the exact resource required to deliver it. It should also be possible to pay for only the services you use – for example, just paying for the storage you actually use rather than paying for a server and paying someone to maintain it.

The point is that you don't need to understand the cloud as a new business concept to use it because consumers inherently understand how it works. When I switch on a power socket at home, I expect electricity to flow. I have no idea how many people worked in the power company to ensure that happened, but it happens and I pay only for the power I use.

When I turn on a tap, I get water and I similarly have little understanding of how much effort goes into ensuring that this tap produces fresh water, but it does. I also pay only for what I use. Apply these concepts from the home into the world of business and suddenly it looks a bit silly to buy banks of servers that are redundant 99% of the time, tying up capital in the equipment and needing to spend on facilities to house it all and people to maintain them. Or buying software that needs to be installed, maintained, upgraded, and paid for whether users are actually using it or not.

When the business users or technology services start thinking about the cloud in the same way they think about their utilities at home, then they will understand not only what it is, but also the immense potential.

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