The idea of cloud computing is to access the storage, computing power and software that you need remotely, through the web. Instead of buying your own servers and individual software licenses for every user, you effectively rent it.
It’s basically a subscription or pay-as-you-go service, accessed over the internet that extends your access to storage, processing and software, theoretically indefinitely.
As such it can be a brilliant way to increase capacity or add functionality and new software as you go along, without investing in new infrastructure. It allows you to be flexible.
And it’s completely scaleable. You’ll probably prefer to own critical software and in-house storage facilities, but use a cloud solution for less day-to-day applications.