The most basic definition of the cloud is technology that stores data and accesses programs using servers hosted over the internet instead of relying on a local server confined to a specific office or a personal computer's hard drive. Cloud users aren't confined to one personal computer, giving them greater flexibility for how and where they work, and a higher likelihood of retrieving their files, emails and data in the event of an office accident, device theft or operating system hack.

There are three types of cloud platforms:

Public clouds: Brands such as Amazon Web Services, Microsoft Azure and Rackspace are examples of public cloud platforms, which are owned and managed by providers supplying cloud tools to multiple external clients on a pay-as-you-go basis. Firms that use public clouds lower the costs of buying and maintaining their own infrastructure because their cloud providers use economies of scale to take care of those responsibilities.