Cloud Computing Primer

Table of contents

  1. Overview
  2. What is Cloud Computing?
    1. Key Characteristics
  3. Traditional IT vs. Cloud Computing
    1. Traditional On-Premises Model
    2. Cloud Computing Model
  4. Virtualization: The Foundation of Cloud
  5. Business Benefits of Cloud Computing
    1. Cost Optimization
    2. Agility and Speed
    3. Scalability and Performance
    4. Security and Compliance
  6. Cloud Computing Challenges
    1. Data Control and Sovereignty
    2. Connectivity Dependencies
    3. Skills and Culture
  7. Real-World Applications
  8. Getting Started
    1. Key Assessment Areas
    2. Migration Approach
  9. Summary
  10. Next Steps
  11. Additional Resources

Overview

Cloud computing has revolutionized how organizations consume and manage technology resources. Understanding core cloud concepts is essential for anyone working with modern digital solutions, especially in contexts requiring sovereignty and security controls.

What is Cloud Computing?

Cloud computing is the delivery of computing services—including servers, storage, databases, networking, software, analytics, and intelligence—over the internet (“the cloud”) to offer faster innovation, flexible resources, and economies of scale.

View Diagram: Five Essential Cloud Characteristics (NIST)

NIST Cloud Computing Essential Characteristics Figure: The five essential characteristics of cloud computing as defined by NIST SP 800-145

Key Characteristics

On-Demand Self-Service

  • Users can provision computing capabilities automatically
  • No human interaction with service providers required
  • Instant access to resources when needed

Broad Network Access

  • Services available over the network
  • Accessible via standard mechanisms
  • Supports heterogeneous platforms (mobile, tablets, laptops, workstations)

Resource Pooling

  • Provider’s resources are pooled to serve multiple consumers
  • Multi-tenant model with different resources dynamically assigned
  • Location independence with abstraction of physical resources

Rapid Elasticity

  • Capabilities can be elastically provisioned and released
  • Scales rapidly outward and inward commensurate with demand
  • Resources appear unlimited to consumers

Measured Service

  • Cloud systems automatically control and optimize resource use
  • Monitoring, controlling, and reporting provide transparency
  • Pay-per-use model based on actual consumption

Traditional IT vs. Cloud Computing

View Diagram: Traditional IT vs Cloud Computing

Traditional IT vs Cloud Computing Figure: Traditional IT requires weeks/months for provisioning while cloud enables instant deployment

Traditional On-Premises Model

Capital Expenditure (CapEx)

  • Large upfront investments in hardware and software
  • 3-5 year refresh cycles
  • Fixed costs regardless of utilization

Resource Management

  • Over-provisioning to handle peak loads
  • Underutilized resources during low demand
  • Manual scaling processes

Operational Overhead

  • Physical maintenance and support
  • In-house expertise requirements
  • 24/7 monitoring and management

Geographic Limitations

  • Single location dependency
  • Disaster recovery complexity
  • Limited global reach

Cloud Computing Model

Operational Expenditure (OpEx)

  • Pay-as-you-consume model
  • No upfront capital investments
  • Variable costs based on actual usage
View Diagram: CapEx vs OpEx Comparison

CapEx vs OpEx Comparison Figure: Capital Expenditure (CapEx) vs Operational Expenditure (OpEx) cost models over time

Virtualization: The Foundation of Cloud

Cloud computing is built on virtualization technology. Understanding hypervisors and virtual machines is essential for grasping how cloud resources work.

View Diagram: Hypervisor Types

Hypervisor Types Comparison Figure: Type 1 (bare-metal) hypervisors run directly on hardware for better performance; Type 2 (hosted) run on top of an OS for development/testing

Type 1 (Bare-Metal) Hypervisors - Used in cloud data centers:

  • Microsoft Hyper-V, VMware ESXi, KVM
  • Direct hardware access for best performance
  • Powers Azure, AWS, GCP infrastructure

Type 2 (Hosted) Hypervisors - Used for development/testing:

  • VirtualBox, VMware Workstation, Parallels
  • Runs on top of a host operating system
  • Good for local development environments

Dynamic Resource Management

  • Elastic scaling based on demand
  • Optimal resource utilization
  • Automated provisioning and de-provisioning

Managed Services

  • Provider handles infrastructure maintenance
  • Built-in security and compliance
  • Professional-grade operations

Global Scale

  • Worldwide data center presence
  • Built-in disaster recovery
  • Global content delivery

Business Benefits of Cloud Computing

Cost Optimization

Reduced Capital Expenditure

Traditional: $100K server purchase
Cloud: $500/month when needed (60% savings over 3 years)

Operational Efficiency

  • Eliminate hardware maintenance costs
  • Reduce IT staffing requirements
  • Automated backup and recovery

Agility and Speed

Faster Time to Market

  • Deploy applications in minutes, not months
  • Rapid prototyping and testing
  • Quick scaling for business growth

Innovation Enablement

  • Access to latest technologies
  • Experimentation with low risk
  • Focus on business value, not infrastructure

Scalability and Performance

Elastic Scaling

Peak Season: 10x normal traffic
Cloud Response: Automatic scaling
Result: Consistent performance

Global Reach

  • Deploy worldwide in minutes
  • Content delivery optimization
  • Reduced latency for users

Security and Compliance

Professional-Grade Security

  • Dedicated security teams
  • Advanced threat detection
  • Regular security updates

Compliance Certifications

  • SOC 2, ISO 27001, FedRAMP
  • Industry-specific compliance (HIPAA, PCI DSS)
  • Audit-ready documentation

Cloud Computing Challenges

Data Control and Sovereignty

Data Location

  • Understanding where data is stored
  • Compliance with local regulations
  • Cross-border data transfer restrictions

Access Control

  • Who has access to your data
  • Administrative privileges
  • Audit and monitoring capabilities

Connectivity Dependencies

  • Internet reliability for business continuity
  • Bandwidth and network performance requirements
  • Hybrid connectivity with on-premises systems

Skills and Culture

  • New skills needed: Cloud architecture, DevOps, automation
  • Cultural shift: CapEx to OpEx mindset, new processes

Real-World Applications

Startup: Launch globally without infrastructure investment, scale on demand Enterprise: Migrate legacy apps, enable collaboration, leverage analytics Healthcare: Secure patient records, remote consultations, AI diagnostics

Getting Started

Key Assessment Areas

Current State: IT pain points, infrastructure age, scalability needs Business: Growth plans, geographic expansion, compliance requirements Risk: Data location requirements, change management capacity

Migration Approach

  1. Educate and plan: Assess landscape, identify cloud-ready apps
  2. Pilot: Start with non-critical apps, validate security/compliance
  3. Gradual migration: Move systematically, optimize, implement governance

Summary

Cloud computing represents a fundamental shift in how organizations consume technology. By understanding these core concepts, you’re prepared to explore more advanced topics including:

  • Service Models (IaaS, PaaS, SaaS)
  • Deployment Models (Public, Private, Hybrid)
  • Security and Compliance considerations
  • Microsoft Azure platform specifics

Next Steps

  1. ✅ Review cloud characteristics and benefits
  2. ✅ Consider how cloud computing applies to your organization
  3. ✅ Continue to Cloud Service Models
  4. ✅ Complete the Knowledge Check

Additional Resources

Last Updated: November 2025