July2024McKinseyExplainersWhatiscloudcomputing?Cloudcomputingallowscompaniestostoretheirinfrastructuresremotelyviatheinternet,ultimatelyreducingcostsandcreatingvalue.Rememberwhencomputerswerebig,hulkingobjectsthatdominatedtheoffice?Maybeyoudon’t;manydigitalnativeslearnedtotypeonsveltelaptops,notclunky,plug-inergonomickeyboards.Here’salittlehistory:whentheywerefirstputintouse,inthemiddleofthe20thcentury,computerscouldfillawholeroom.Bythetimetheystartedappearinginthehouseholdsofthetechsavvy,theyweresmaller,aboutthesizeofastepstoolthatcouldfitunderadesk.Now,ofcourse,theyfitinourpockets(andsome,eveninourbrains).Thetransitionfromhugetotinycomputershasbeendrivenbyanumberoftechnologicaladvances.Transistors,integratedcircuits,microprocessors,LCD,andlithium-ionbatterieshaveallplayedaroleintheminiaturizationofcomputerssincetheycameonthescene.Theemergenceofcloudcomputinghasalsoplayedamajorroleintheevolutionofcomputingoverpastdecades.Previously,organizationsandindividualswouldhavetostoreandrunalltheirdata,systems,andapplicationsontheirownservers.Withcloudcomputing,organizationsengagecloudserviceproviders(CSPs)tohostandruntheirapplicationsonremoteservers,usingonlyasmuchcomputepowerandstorageasneededtomeetdemand.Thistheoreticallyallowsforcheaperandfastercomputingbecauseiteliminatestheneedtopurchase,install,andmaintainser...
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