Corporations in the cloud

This is not a very scalable solution, often new servers have to be added even if the current ones do not perform at their maximum capacity. With new technologies the demand and provisioning of computing power and storage is virtually separated. You ask for space to store a picture and you get it, but you don't know on which machine the photo will be stored (and you don't care as long as it is stored safely and you can find it back). This allows for a much more efficient organisation of IT. A computer cloud is such a virtual environment where a lot of computer capacity is concentrated by aggregating the power of many servers. Firms like Google and Amazon have massive data-centres where thousands of servers together form a computer cloud to provide digital services.

These clouds are the future of corporate computing. It promises to scale much better and provide infrastructure at a lower price. You don't have to invest in data-centres any more. Computing power and storage become like electricity: you just pay for the amount you use.
There are of course some concerns with regards to security and other legal issues. These can be solved.

If you are interested, the Economist published a special report on this topic in the edition of this week. You can read the report online and download a free PDF.