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A model of Cloud Computing where a data center is owned and managed by a third-party company. Computing resources are shared by customers on demand. The typical utility billing model is a pay-per-usage model where customers only pay for resources they consume.  The burden of procuring server, networking hardware, and its management is covered by the cloud computing company.  Virtual Machines which consume more CPU and memory cost more per month than a VM using less compute resources.

Customers do not choose or configure such things as the hardware, cache or storage performance. The third-party company places the customer’s virtual server on the cloud provider’s general hardware and network systems.  Compliance with privacy and security requirements, such as Payment Card Industry (PCI) or Sarbanes–Oxley Act of 2002 (SOX), are not possible in the public cloud.

Related Glossary Term: cloud