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what is therefore needed is an architecture that, in a similar way as the elec-
tricity grid, decouples the means of supporting the day-to-day operations of
users from the underlying functional infrastructure that underpins them.
This would also allow the business to reconfigure its operational strategy
without necessarily amending its underlying IT systems. With the function-
ality described earlier, Cloud Computing has the potential to provide the
decoupling layer in companies. In conclusion, the biggest benefit of cloud
computing is the increased potential for companies to achieve new levels
of innovation capabilities that can differentiate their business from com-
petitors. Cloud Computing enables implementing of new business processes
and applications that companies would not be able to implement by using
conventional information technology. Cloud computing provides a virtual,
resilient, responsive, flexible, and cost-effective infrastructure that fosters
innovation and collaboration.
1.2 Modern On-Demand Computing
On-demand computing is an increasingly popular enterprise model in which
computing resources are made available to the user as needed. Computing
resources that are maintained on a user's site are becoming fewer and
fewer, while those made available by a service provider are on the rise. The
on-demand model evolved to overcome the challenge of being able to meet
fluctuating resource demands efficiently. Because demand for computing
resources can vary drastically from one time to another, maintaining suf-
ficient resources to meet peak requirements can be costly. Over-engineering
a solution can be just as adverse as a situation where the enterprise cuts costs
by maintaining only minimal computing resources, resulting in insufficient
resources to meet peak load requirements. Concepts such as clustered com-
puting, grid computing, and parallel computing may all seem very similar
to the concept of on-demand computing, but they can be better understood
if one thinks of them as building blocks that evolved over time and with
techno-evolution to achieve the modern cloud computing model we think
of and use today.
1.2.1 Grid Computing
In the late 1980s, computers were clustered together to form a single larger
computer in order to simulate a supercomputer and harness greater process-
ing power. This technique was common and was used by many IT depart-
ments. Clustering, as it was called, allowed one to configure computers using
special protocols so they could talk to each other. The purpose was to balance
the computational load across several machines, divvying up units of work
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