The Complete Guide to Cloud Computing and How It Works

Cloud computing is an efficient and flexible resource hosted on the Internet, offering access, flexibility, and economies of scale. This article will provide a quick overview of cloud computing, what cloud computing is, and the features of the services offered.

The Introduction of Cloud Computing

Many companies use mobile and digital technologies to improve the customer experience within their IT Landscape through cloud-based solutions that aid users on their journey to digital transformation.

In the age of cloud technology, the use of collaborative technology tools for organizational use is crucial to a company’s survival and competitiveness in the market. Moving to cloud computing is a significant step in the right direction, and businesses have a variety of alternatives to move at their pace.

cloud service layer
Cloud service layer

The majority of on-premise SAP clients have already invested substantially in their current on-premise systems, making replacing their IT infrastructure with cloud-based solutions virtually impossible. However, companies require flexibility in cloud services that don’t eliminate all of their existing investment in on-premise IT. However, it can help them with their digital transformation process.

What is cloud computing?

The concept of something happening could be used to explain cloud computing. In cloud computing, there are IT services like storage, computing, and databases, as well as security, networking, and others. They are hosted in a secure place (that is, a data center) and are accessible without thinking about or even thinking about how they’re set up and licensed. Cloud computing refers to applications that run in an offsite location rather than an individual personal computer or server and are available remotely to us.

Sign up for a sign-up form and then begin using public email services (such as Gmail, Yahoo, and so on). When we first start using a service, we do not worry about how mail services are set up, how secure the infrastructure is, how you can license the program, if the staff is highly skilled and available to manage the infrastructure, and so on. It is enough to start using mail services by providing a secure password.

cloud computing
Cloud computing

type of cloud computing

Clouds are classified into three types at a higher level:

Private cloud :

A private cloud is a collection of infrastructure, platforms, and application-related services housed in secure remote facilities offering computing, forum, or other IT-related services that are available on demand and controlled by a specific company. It is a preferred choice for companies requiring a secure space for hosting or data centers. Continuous improvement of staff’s abilities and infrastructure for data centers is necessary. It can be costly and time-consuming to keep the private cloud.

Public Cloud

The public cloud is a host of infrastructure, platform, and application services located within secure, remote locations that provide computing services and other IT services on an isolated, shared platform accessible to the public via subscription. This is known as a public cloud. It is favored by startups, MNCs, government organizations, and military, scientific, and pharmaceutical companies who want to use cloud computing on demand. Cloud computing allows companies to concentrate on their business instead of being constantly involved in the process of upgrading their existing IT infrastructure, allowing them to develop modern solutions that are competitive with other competitors on the market.

It is possible to access all services with a pay-as-you-go model in a cloud public. This makes it easy and affordable to experiment with different designs to determine the most effective solution for accelerating the growth of your organization. Another benefit of the cloud public is that it has a virtually unlimited resource pool as and when needed to increase the size of IT infrastructure to meet short- or long-term demands.

Hybrid cloud

A hybrid cloud is an environment in which cloud services are used as a combination of private cloud, on-premises, and public cloud services to meet the organization’s requirements. In this scenario, the private cloud can use a public cloud’s resources to accommodate a sudden rise in the demand for resources. Because personal data centers have minor resources, they can be extended to an external service provider’s public cloud. The hybrid model can meet any need, such as budgetary, financial, and unique requirement constraints on infrastructure or any other organizational requirement.

When did cloud computing start?

The evolution of cloud computing began mostly in the 1950s, and concepts like virtualization, service-oriented architecture, utility computing, and autonomic computing are the foundations of cloud computing today:

  • In the 1950s, mainframe computers were shared with various users via dumb terminals, making it cheaper and more efficient use of resources.
  • VMs were developed in the 1970s to combat the shortcomings of earlier technologies. The VMs allowed us to operate more than one operating system simultaneously in separate environments and provide all the essential resources like RAM, CPU, disk, and NIC separately to each VM.
  • In the early 1990s, telecom companies began offering committed point-to-point data circuits dubbed VPNs. They delivered it at a lower cost than the technologies that were then in use. This invention enabled the maximization of the use of bandwidth.VPN enabled it to grant connectivity to the infrastructure for many users, even in isolated environments.

In 1997, Professor Ramnath Chellappa defined cloud computing as the following:

  • The computing paradigm in which the limits of the computer will be determined by economic justification rather than technical limitations alone.
  • In 1999, HTTP: web. began to offer enterprise-level application services through the internet. This was among the most significant developments in the history of the cloud.
  • In the first quarter of 2000, Amazon introduced web-based retail services in its newly modernized data centers. Although Amazon did not use more than 10 percent of its data center capacity, it realized that modern cloud computing models for infrastructure could increase efficiency and effectiveness.
  • In the latter part of 2000, Google introduced its docs services directly to end-users. This changed the end users’ concept of document storage and cloud computing.
  • In 2006, Amazon officially began to launch EC2 and S3. In the following decades, Amazon released various cloud services under the AWS brand.
  • It was in 2008 that Google launched its application engine services in beta. This was the start of Google Cloud services.
  • In 2010, Microsoft Azure was released and was followed by various cloud services in the subsequent years.

What are the advantages of cloud computing

There is a tonne of benefits to using cloud computing, which I’ll try to explain.

Switch from capital expenditure( CapEx) to operational expenditure (OpEx)

There is no need to pay the massive initial expense of purchasing hardware or software and including computing infrastructure, also known as CapEx, in the budget. With the cloud model, you pay for the services you use every month. This is known as OpEx.

Cost advantage comes from massive economies of scale

Every infrastructure provider (AWS, Google, Microsoft) buys every item in bulk & it offers a price advantage. AWS transfer the benefits from this price advantage to its customers by providing its services at a low cost. When the AWS cloud gets bigger and bigger, the massive economies of scale will benefit AWS and its end customers.

There is no need to figure out the needed infrastructure capacity.

Most of the time, before the actual IT implementation, the guessing of IT infrastructure requirements leads to either a shortage of resources or a waste of resources once production starts. cloud computing service provider allows you to expand the system up or down according to the infrastructure requirement.

Acceleration and speed 

When setting up a data center on-premise, companies must wait to obtain the right equipment or software from vendors for a long time. With cloud computing, it is now much easier for businesses to get up and running quickly, establish the infrastructure using cloud service immediately, and not rely on third-party vendors. There is no need to issue an order for the purchase or wait for delivery; sign in with the account, and they will have everything they need.

Global access

Cloud computing has data centers and service locations around the world. Make use of this by hosting your infrastructure close to the market you want to serve or in multiple locations around the globe for an affordable cost.

What are cloud computing services?

Cloud computing can be described as a general concept that offers a wide range of services. The most popular cloud computing models include Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). Let’s look at these models from a general perspective:

cloud service models
Cloud service models

Infrastructure as a Service (IaaS)

When the service provider provides virtualized computing infrastructure or hardware as a service, the service is known as IaaS.

Platform as a Service (PaaS)

PaaS is a cloud service where the service provider provides platforms and tools through the cloud, typically allowing application development. This service model is where the software and hardware are stored on the service provider’s service infrastructure.

Software as a Service (SaaS).

In the SaaS model, the service provider provides Software or apps. Service providers manage the applications, and the user just consumes the SaaS without having to think about the hosting platform.

Cloud computing deployment models in sap

Hybrid of talent

This configuration lets us keep all SAP applications on-premise for administration. Then, it allows us to move all the processes for talent to cloud-based solutions. Standard integrations ensure that your processes and data are synchronized between the existing SAP systems and Cloud Talent Solutions on the cloud. This model can be an entry point to the complete cloud model.

Hybrid core

This model lets us transfer all of the current applications. Standard integrations guarantee that all data is synchronized between the existing application and the new one. This model could also be used to get to the cloud model fully.


This model lets you implement all core processes in the cloud. Standard integrations are provided to processes that need only a small amount of core data from an on-premise SAP system. This is an ideal scenario when we connect data with third-party vendors like Automatic Data Processing. We can also perform integration through SAP Cloud Platform Integration or SAP BTP.


This approach lets us implement a cloud SAP application system alongside an already existing on-premise SAP system installation. This is a mix of on-premise and cloud-based approaches. The user interface can be integrated so that users can only access a single system. This model could also be used to get to the complete cloud model.


The first thing business owners should do evaluate their needs. They determine the workload they need the cloud provider to support, The cloud offers many advantages over traditional methods of hosting data, such as reduced hardware costs and improved reliability through redundancy. Organizations can focus on business development while the rest of the technical aspects will be taken care of by the service providing advantages in terms of price and accessibility. It also offers scalability and flexibility, which means that it can be used for a variety of purposes.

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