Cloud computing is a way to leverage the resources in the cloud (internet) instead of your local box. We may hear the term SaaS (software as a service) and HaaS (hardware as a service). They are combined moving us to an new generation of computing, called utility computing. You can imagine software and computing power could be leased like electricity and our laptop is more like a device to hook it up. That is a great news for enterpreneurs like us. Now, we can leverage the cloud to reduce the first time set up cost to support million of users. It is not just an idea. Companies like Amazon has released EC2 (HaaS), Google has released Google App Engine (HaaS) and Salesforce has released online customizable CRM (SaaS). We can expect more to come in this area. Here is a good video that gives you a better explanation.
For SaaS, it is similar to the ASP model. After Web 2.0, developers can now make applications that give you similar user experience as your desktop applications. Now, you can find out application like excel and powerpoint on the Net. Check out Google doc and Sliderocket.com and you will find out how powerful these tools are. The beauty of these tool is that you don’t need to buy or download applications to your laptop and you can access it anywhere, anytime (assume you have Internet access). On top of top, it promotes collaborative work that can only be achievable through the Internet. I am really excited to see more applications come out to replace the desktop application and I can use my iPhone to use it anytime I want. 
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