A cloud-based environment is an array of computing hardware, software, and data that is hosted by a third-party service and accessible via the Internet. It may be an Infrastructure as a Service (IaaS), Platform as a Service (PaaS) or Software as a Service (SaaS) solution.

Cloud computing environments that are public provide simple, scalable access over the Internet to computing resources, eliminating capital expenditures and cloud environments allowing businesses, when needed, to make use of more computing power without disrupting their development schedules. However, businesses should watch out for expensive hidden fees and costs, such as fees for data transfer, extra storage costs, or fees for specialized support or technical assistance.

Private cloud environments offer the flexibility of public clouds but with the added benefit of being private. Typically, the business will own the hardware for computing and may also lease space to run the service from a third party hosting service.

To ensure control and visibility the IT department of a business must keep track of the performance of applications. Modern cloud computing capabilities for automation reduce complexity, while improving productivity and IT agility.