Cloud computing is the future of digital storage and computing resources served up remotely from data centers, also known as the cloud. Consumers can access multiple applications from any portable device that supports little processing power. these devices save energy and can access the information from anywhere for as short or as long as required because they take less electricity to power.

Amazon, Google and Microsoft have made a big push in this space to capture market share. For Microsoft, the challenge becomes building on its Azure cloud as businesses in the United States begin to ramp up as the economy improves. For example, the latest version of Microsoft Office for Mac 2011 desktop suite features social networking tools, co-authoring tools and a connection to Microsoft Office Web apps. it also connects through cloud computing.

For Amazon, cloud computing could provide the server capacity that allows it to launch a movie channel on the Kindle, where server capacity would support streaming videos on demand. Apple could also provide this feature on the iPad. in theory, consumers and companies can house data in a secure area on a server cloud. an application suite could allow people to use and transmit data using the programs.

in a perfect cloud world, people would wander around with a light display device with minimal processing power that lets them access applications from anywhere. The devices don’t require huge amounts of processing power. They will only need to pick up and transmit signal and data.

And while these are hypothetical scenarios Joseph Rosenbaum and I discussed recently, the technology isn’t that far off from making it a reality, claims the Reed Smith partner, who chairs the firm’s global Advertising Technology & Media Law practice.

Microsoft has been working on offering applications that support functions that process payroll, create Word documents and edit photos. these applications not only populate a database, but have the ability to send and receive data changes without having the program on your computer.

The idea harkens back to dumb computer terminals, (a concept that I hope shows my knowledge about computing, rather than my age). it allows users to do more with less computing power on the desktop or phone because the server-side software does the processing and they just interact with it. Cloud computing takes that concept a little further.

Rosenbaum tells me his vision of cloud computing connects devices to applications that sit servers. Think utilities, he says. The model would let companies implement a flexible pay-as-you-go system. Pay by the hour, kilowatt or some other type of benchmark. Also think about the way companies began outsourcing IT services or human resources. Sophisticated Adobe rendering software may cost more than Microsoft Word, but people would have access to all on a variety of different devices that could access the Web.

Rosenbaum also points to gas or electronic companies. They don’t care whether you plug a battery charger, PC or toaster into a wall outlet, they charge for the electricity that drives the devices. Imagine you have a screen and a keyboard and could just plug it in as you wandered around the world. all you’d need is an account number and an access point to the Internet, whether wireless or wired. it wouldn’t matter what wireless carrier provides you cellular service, or if your carrier doesn’t offer cellular service. you roam, and more often than not, the phone still works. Why wouldn’t the cloud function be similar?

I nod my head when Rosenbaum suggests Google, Microsoft and Amazon could offer cloud services, but they would need to reach an interoperability agreement, so consumers could quickly move from one application to another worldwide. he explains the theory that “cloud computing is fundamentally built on a capacity model — which is to say that if I have a generator with a specific amount of capacity, I need to make sure I can service my customers at peak times.” thus, “I would try and optimize the use during lower times to make sure the servers don’t work overtime and burn out during some hours of the day, and sit idle at other hours of the day.”

A Dream Cloud Computes The Future