This is a new type of hosting platform that allows customers powerful, scalable and reliable hosting based on clustered load-balanced servers and utility billing. A cloud hosted website may be more reliable than alternatives since other computers in the cloud can compensate when a single piece of hardware goes down. Also, local power disruptions or even natural disasters are less problematic for cloud hosted sites, as cloud hosting is decentralized. Cloud hosting also allows providers to charge users only for resources consumed by the user, rather than a flat fee for the amount the user expects they will use, or a fixed cost upfront hardware investment. Alternatively, the lack of centralization may give users less control on where their data is located which could be a problem for users with data security or privacy concerns.
^ March 16, 1992 memo from Mariam Leder, NSF Assistant General Counsel to Steven Wolff, Division Director, NSF DNCRI (included at page 128 of Management of NSFNET, a transcript of the March 12, 1992 hearing before the Subcommittee on Science of the Committee on Science, Space, and Technology, U.S. House of Representatives, One Hundred Second Congress, Second Session, Hon. Rick Boucher, subcommittee chairman, presiding)