The answer is both. It is a technology breakthrough and a new business model. It is a technology because it provides totally different and much more advanced computing resources than before. Cloud computing provides an infinite, elastic, and resilient resources. It is a business model because it has changed the way businesses acquire computing resources from owning to renting them. Let’s discuss a little bit further.
In the past, the mainframe system had a Virtualization technology already which was implemented on memory resources called Virtual Memory. This technology makes the memory resources become infinite to the users although the actual physical memory is very limited. Can you imagine how a computer with 128 K bytes physical memory can serve a hundred users ?. Cloud computing brings this virtualization technology even further not only to memory resources but also to CPU, Networking, and other resources. This makes it possible to provide an infinite computing resources. But Cloud computing is more than just virtualization, it has the capability of distributed computing such as grid computing, etc. The infinity nature is required by the internet business revolution where unpredictable fluctuating resources requirement is very common. With the whole world as the targeted market, a very large even an infinite computing resources is a must.
Before cloud computing era, every business must acquired a starting computing resources to start the operation. The size of the required computing resources is merely based on a prediction. Surely, this is not a small investment considering all the needed supporting resources as well such as the hardware room, IT staffs, and so on. Another thing is that the internet business characteristic is hard to predict since you cannot arrange all the business’s prospects from around the world to access the system at a certain time. Therefore, an elasticity is a must in order to provide a computing resources that can gradually and automatically expanding or shrinking depending on the needs at any given time. From the business point of view, it will save businesses from wasting money on over investment and on the other hand from experiencing an overloaded or failed system.
Data lost is something that is considered to be very painful and damaging to a business. Hardware failure is also to be avoided because it will stop the business operation. Cloud computing technology will provide a resilient computing resources both from data lost and hardware failure. It will automatically backup the data at other locations as well so that data lost will not ever happen even if there is an earthquake at one cloud computing center. Also it will automatically move the processing to another computing resources if a hardware failure occur at the current computing resource. It can be concluded that cloud computing provides an immune computing resources from any kind of failure.
Utility Business Model.
Sometimes people call cloud computing as utility computing also. It is because the business model is just like a utility business commonly known such as electricity where you pay only what you use. Considering the very large required investment for building the cloud computing facilities, only giant companies can afford it. That is the reason why the new business model must be used for the cloud computing technology to be able to be enjoyed by all companies including a very small one. That is why cloud computing is considered to open an equal opportunity to both big and small companies to compete and succeed.
I hope this short discussion can help you to understand better about cloud computing regarding whether it is just a technology revolution or just a new business model on the same old technology.