Here's the perspective on "cloud" from someone (me) who works in IT at a manufacturing corporation:
"Cloud" as marketing is not really aimed at you. Well maybe Dropbox and Google Drive count as cloud, since glorified file sharing/sync'ing is branded as iCloud by Apple.
The "cloud" marketing is aimed at me, and the 6000+ sq ft data center I have which costs almost twice as much to cool as it does to power. That creates a compelling case for using something like Amazon Web Services, who can afford a more efficient data center than I can. Although the prices are still a little high and my efficiency is above the norm, so not yet. Yet.
AWS is virtual hosting - the traditional kind, where you can get your own linux or Windows server (they now have a free usage tier - anyone can have their own linux server to play with) - plus software components, like databases, messaging and queueing servers, storage, monitoring, content delivery, workflows - that can be built instantly and paid for only based on the computing capacity you need.
The scalability and flexibility is really where "cloud" shines. Instead of deploying applications to physical and virtual servers in my data center, I can deploy architectural images and software components as needed to match the needs of my business. I don't have to try and forecast how much capacity we will need in 5 years; I buy capacity as needed and increase or reduce it to match the ebbs and flows of our business.
Conceptually it makes sense. One of the challenges is adjusting the mindset from thinking of hardware and software as capital (which can be purchased in bulk and depreciated over a number of years) to thinking of it as flexible expense. Since Wall Street cares about a silly concept like EBITDA, it is "better" to capitalize when we can than adjust expense budgets, even if the dollars in capital vs. expense are the same. Once I've spent the capital no one cares about my depreciation costs. But add those dollars to my expenses to outside firms, even to support that new acquisition? Fat chance!
Matt -- GnuPG Key ID: 0xC33BD882 aim/google/MSN/yahoo: beyondzero123