BASIC DEFINITION
Cloud computing which is usually referred to as simply “the cloud,” is the on-demand delivery of compute power, database storage, applications, and other IT resources through a cloud services platform via the internet with pay-as-you-go pricing.
Key word here is “on-demand”. You demand that you need some resource (CPU/Storage/Database/Platform/Apps etc) and you get it instantly by as simple as pressing couple of keys in your web hosted Cloud Panel.
Traditionally, you used to first order these resources through defined channels before started using them. Example, in your traditional setup, as a DBA if you required another 1 TB of disk for your database you may have to go to your UNIX Admins which in turn used to go to storage admins and Storage admins used to carve out the right size disk or order new capacity from the storage company. UNIX Admins then partition and extend the LV and then at last you will get the disk to increase your database size. This is very simple example of traditional system but explains that it takes resource. time and effort to get such repetitive things done. Cloud computing helps in overcoming such limitations.