Ask a friend what cloud computing is and you’ll likely get a look of bewilderment. Enter a search in Google for “cloud computing” and one of the first hits you find is a Youtube.com video of technologists at a recent conference giving their differing explanations of what cloud computing actually is. In fact, defining cloud computing really depends on the observer. The term itself is certainly apropos: explaining “cloud computing” is like describing real clouds... it depends on the viewer and their perspective as the various shapes morph into animallike creatures, ever evolving.

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Generally, the “cloud" is described as the combination of available Internet applications, Software as a Service (SaaS) and hosted hardware server options (Hardware as a Service, HaaS) with expanding interconnectivity and integration. As an example in our industry, consider an advisor who might move the entire firm’s technology infrastructure to an off-site, secure, hosted server network with quad-redundancy and managed IT support. By loading all traditionally desktop software, like MS Office, email server, portfolio management, CRM or any other critical software on this server, all staff can access the server from any location, reducing the number of licenses needed and completely outsourcing nearly all IT support. Couple this with using more and more Web-based applications and a firm reduces costs and can scale for much faster growth across multiple physical locations.