What is the cloud really?

We’ve all heard it: “make sure to save it in the cloud.” But what is the cloud, really? Is it some magical, floating entity, or something more grounded? At its core, the term “cloud” refers to a network of servers, real, physical machines housed in data centers and connected by tangible infrastructure. Understanding this fundamental truth is essential for making informed decisions about infrastructure, sustainability, and operational resilience.

Bringing the cloud back down to earth

It’s tempting to think of the cloud as some vague or ethereal concept, but in reality, it’s entirely physical. Every digital activity you perform in the cloud, whether it’s running software, storing files, or processing data, relies on real servers housed in data centers around the world. These facilities provide the essential power, cooling, connectivity, and security that make cloud computing possible.

As IBM puts it, a data center is simply “a physical room, building or facility that houses IT infrastructure such as servers and storage devices for building, running and delivering applications and services.” Major cloud providers like Microsoft (Azure), Google (Cloud), and Amazon (AWS) operate enormous data centers filled with racks of computing equipment. But the cloud isn’t limited to global tech giants or large companies. Organisations of all sizes, including public institutions and startups, also use the cloud. Some choose to run their own cloud environments, called private clouds, using infrastructure they manage themselves, either on-site or in shared facilities known as colocation data centers, where space and resources are rented but not owned. In every case, the cloud “lives” on real machines. Not in thin air.

Public, private, hybrid and multicloud

One useful way to understand the cloud is to look at the different types of cloud environments (public, private, hybrid, and multicloud) based on who manages the infrastructure and how it’s used. While these models vary in structure and control, they all rely on physical equipment in data centers.

• Public cloud services, offered by providers such as Microsoft (Azure), Amazon (AWS), and Google (Google Cloud), give users access to computing power and storage over the internet. These providers install and manage their own hardware in professional data centers, which they may either own or lease from specialized facility operators. While users don’t know exactly where their data is stored, they benefit from massive scale, flexibility, and global reach.

• Private cloud refers to a cloud environment used exclusively by one organisation or institution. It can be set up in a data center the organisation manages itself, or hosted by a third party. Unlike public cloud, the infrastructure is reserved for a single user group. Private clouds use similar technologies as public clouds. One of these is virtualisation: a method that allows multiple virtual computers to run on a single physical machine. The key difference is that private clouds offer more direct control over data, security, and performance. Organisations using a private cloud know exactly where their data is stored, as it is hosted on their own infrastructure.

• Hybrid cloud blends the two. For example, an organisation may store sensitive data in a private environment while using the public cloud for less critical or highly variable workloads. This approach allows flexibility, combining the strengths of both models.

• Multicloud means using cloud services from more than one provider, such as combining Microsoft Azure for certain tools, Amazon Web Services for data storage, and Google Cloud for analytics. This strategy helps organisations avoid relying too heavily on a single vendor and allows them to choose the best service for each specific need.

Regardless of the model, the cloud always relies on physical infrastructure (racks of equipment, network connections, and cooling systems) housed in secure, professionally maintained data centers.

From rivals to allies

Today, cloud and on-premises infrastructure are no longer seen as competing options. Most organisations now follow a hybrid approach, combining cloud services with on-site systems to build flexible and resilient IT environments.

This strategy offers several clear benefits. By keeping critical or sensitive applications in a private cloud (hosted either on-premises or in a professional data center), organisations maintain greater control over security, compliance, and performance. At the same time, they use the public cloud for scalable workloads, such as data processing or web applications, that need to grow quickly and cost-effectively.

As Microsoft’s Tiziano Durante puts it: “When we say hybrid, I see a hybrid model where the cloud runs on a hyperscale data center and the on-prem infrastructure is hosted in an enterprise data center.”  IT teams are increasingly combining in-house infrastructure or colocation in a professional data center with public cloud services. This hybrid approach enhances flexibility and resilience. Energy efficiency has become a key driver, encouraging organisations to move their IT infrastructure to specialised data centers.

Why sustainability is driving cloud adoption

Sustainability has become a major reason, alongside flexibility, scalability, security, and cost control, for organisations to move to the cloud. Beyond the operational advantages, modern cloud data centers are also built with energy efficiency in mind.

Compared to outdated server rooms in office buildings, centralised cloud facilities typically consume less power and generate lower emissions. They are professionally managed, optimised for performance, and increasingly powered by renewable energy. Independent research shows that centralising IT workloads in cloud environments can significantly reduce carbon footprints and improve overall energy efficiency.

In addition, cloud providers benefit from economies of scale, advanced cooling techniques, and intelligent resource management—capabilities that are hard to replicate in small-scale, on-site setups. In contrast, aging local servers often run inefficiently, leading to unnecessary energy use and maintenance costs.

For many organisations, evaluating whether to maintain their own infrastructure now includes sustainability as a strategic factor, alongside performance, governance, and long-term viability.

The cloud is built on real infrastructure

So, what is the cloud, really? It’s not an abstract or floating concept, it’s a network of real computers housed in real, physical data centers. Public, private, or hybrid clouds are simply different ways of organising that infrastructure. In every case, it all runs on data center foundations.

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