Kinda sounds like something out of a bad science fiction movie. Like Web 2.0, SaaS, Social Media and Apps, "The Cloud" has become a very pervasive buzzword. So what the heck is it?
Nowadays, it's all cloud this and cloud that. As usual, everyone is jumping on the new buzzword and making it their own. There are so many definitions for it that it can be very frustrating to decipher which one is right. It's very similar to what happened with the term SaaS a couple of years ago.
Think of it this way. The Internet is the new electricity. Instead of transmitting power, it transmits information. Devices that log onto the Internet are like appliances that you plug into the wall. Computers are the new electric typewriters. Xbox's are the new VCRs. Boxee's are the new cable boxes. Information is the new power, and without it, our society would grind to a halt.
The term "Cloud" is really just another way to say Internet. I think the term actually came from early technical drawings of the Internet showing how things communicated over it. In these diagrams the Internet would always be shown as a cartoon cloud.
Cloud computing is when a vast array or "cloud" of computers are used to spread out computing responsibilities in order to provide a quicker result.
Cloud storage can be thought of as an infinite number of hard drives that are instantly turned on and connected as you need them.
Cloud-based software is software that lives entirely on the Internet. Rather than buy it in a box and install it on a computer, you buy it online and log in to use it.
Try to fight the urge to hate "The Cloud" just because of the corny buzzword. It is probably the most powerful paradigm in computing since the invention of the Internet and there are countless ways that it can benefit your business.