What is cloud computing?

Cloud computing is fundamentally understood as the delivery of computing services over the internet. This encompasses a wide array of resources and services, including servers, storage, databases, networking, software, analytics, and intelligence, all of which are available on demand and typically billed according to usage.

The definition highlights an essential characteristic of cloud computing: its reliance on internet connectivity to provide scalable and flexible computing resources. This allows organizations and individuals to access powerful computing systems without needing to invest in and maintain physical infrastructure. Instead, they can leverage the cloud to access resources that are managed by third-party service providers, translating into cost savings and enhanced collaboration capabilities.

In contrast, the other options focus on aspects that do not encapsulate what cloud computing truly represents. Compiling software applications or processing data in isolated networks does not quite reflect the operational and accessible nature of cloud services. Additionally, local storage pertains to traditional data management techniques rather than the expansive and interconnected functionality that cloud computing aims to provide. Thus, the correct answer encapsulates the essence of cloud computing and its role in modern IT infrastructure.