About a decade ago, if you wanted to put your application on the Internet, you started by buying a server. Then, you had two choices: Bring enough bandwidth to your office or put your server in someone else’s facility. Given the cost of Internet connectivity at the time, it was usually less expensive to rent rack space but, for smaller applications and low volume Web sites, some of us did very well with $100 per month ISDN lines.

Hosting providers understood this, too, and quickly started offering turnkey solutions that included both the server and Internet connectivity. For example… Today, that same $100 per month gets you a basic server in a commercial data center connected to the Internet. From a business perspective, it makes a lot of sense: There’s no capital outlay, no hardware maintenance cost, and the fact that it’s a pure expense is often a tax advantage.

Hosting providers also responded to the demand for something between shared Web hosting and a full server. Leveraging virtualization technology (most commonly, open source Linux), the Virtual Private Server (VPS) market was born, giving small businesses and individuals their own virtual server starting around a $30 per month price point.

For many small businesses, a rental VPS server is a great solution. However, if you’re setting out to develop the next Web 2.0 killer application, your major challenge is scalability. If you’re lucky and your app is an amazing success, how will you handle the load? Will it become the next Facebook, or will will poor performance send it spiraling right into its grave?

Cloud computing is a simple concept: Instead of purchasing specific hardware, why not just purchase computing resources such as virtual computers and virtual storage as you need them?

Over the next few weeks, I’m going to be looking at the Cloud computing phenomenon and discussing the security implications. If you have any questions, please feel free to send them via TLP’s ‘Ask the Editor’ page.