Now that we've covered the fundamental ideas behind cloud computing, it's important to explore some of the benefits, risks, and ongoing challenges that face cloud computing. Because one of the main drivers of cloud adoption is to reduce upfront costs and leverage the economies of scale, we'll look at the economics behind the cloud from two perspectives: cloud users and service providers.

Because computing has migrated from a product to a service, there should be methods to define relationships between the users and service providers. The cloud has adopted traditional contractual guarantees like service level agreements (SLAs) that meet a cloud user's service level objectives (SLOs). We'll see how cloud service providers define SLAs and SLOs to ensure a level of service to their clients. We'll also introduce the concept of cloud service auditing to verify conformity with SLAs.

Apart from contractual concerns, security and privacy are the biggest challenges that prevent sensitive applications from moving to the cloud. We'll explore some of the unique security challenges raised by the cloud and the controls required to resolve them.

Although the cloud has benefited from rapid adoption, there's no one-size-fits-all solution that encompasses all IT requirements. Keep in mind that the cloud is an emerging and fast-evolving paradigm with many active research areas that are exploring its future.

Learning objectives

In this module, you will:

  • Discuss some of the advantages and disadvantages of the cloud paradigm.
  • Articulate the economic benefits as well as the issues/risks of the cloud paradigm for users.
  • Articulate the economic benefits as well as the issues/risks of the cloud paradigm for cloud service providers.
  • Define service level agreements (SLAs) and service level objectives (SLOs), and illustrate their importance in cloud computing.
  • Enumerate and explain various threats in cloud security.
  • Enumerate and explain various controls in cloud security.


  • Understand what cloud computing is, including cloud service models, and common cloud providers.
  • Know the technologies that enable cloud computing.