Cloudonomics: The Business Value of Cloud Computing, + Website

Clarifying the Cloud

What in the world is the cloud? Although there is perhaps no term with as many definitions, for this book we define the cloud with a helpful mnemonic, C.L.O.U.D., reflecting five salient characteristics:

Common infrastructure

Location independence

Online accessibility

Utility pricing

on-Demand resources

It is common, in that it uses pooled resources and dynamically shared infrastructure; location-independent, in that the service should be ubiquitous and responsive; online, that is, accessed over a network; a utility, creating value and with usage-sensitive pricing; and on-demand, that is, with the right quantity of the right resources available exactly and only when needed.

Some of the behind-the-scenes technologies supporting cloud computing are relatively new—for example, virtualization and automated bare-metal provisioning. This book does not delve into these assorted technologies. What we do investigate is the universal principles that have applied since the Roman Republic and are applicable to today’s businesses.

These principles are applicable to the ancient cauponae and today’s hotel chains, taxi fleets, airlines, electric utilities, and lenders. Hotels offer “utility,” “pay-per-use,” or “usage-sensitive” pricing: More rooms for more nights cost more. Electric utilities and taxi companies offer “on-demand” service—flick a switch or raise your hand and service magically appears. Whether data networks, the electric grid, or highways including the ...