Once upon a time applications ran directly on physical hardware. Then the boxes got bigger and more capable and multiple applications were run on the same hardware. There were some resource constraints, but things in general became more efficient. Time passed, things evolved and virtualization was introduced, allowing enterprises to run even more applications even more efficiently on the same hardware. And then the cloud came on the scene, extending the virtualization model to the point that it looked like something completely different, to the point that it became true utility computing. Cloud computing is not just virtualization on a bigger scale and as CIOs prepare their organizations to dive into private clouds at an increasing rate, it is very important to understand what they are and are not, and how they differ from their forbear computer models with which we are all familiar.
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