Oracle CEO Larry Ellison unloaded on cloud computing yesterday, using the words "idiocy," "crap," "gibberish," "crazy," and "stupidest" to describe all the buzz over clouds. It was a classic Ellison rant, but ironic because Oracle is moving into cloud computing even as its leader rails against it.Ellison's anti-cloud barrage came in a meeting with financial analysts, and Reuters' Jim Finkle provides a recap of it here. "What the hell is cloud computing?" Ellison asked.

He's not the only one who's skeptical, confused, or both. Blogs are full of people questioning what all the fuss is about. "Like all of the pie-in-the-sky concepts that came before it, the cloud is just another bank of fog used to hype technology. It's more of the same," one reader wrote in response to InformationWeek's cover story, "20 Cloud Computing Startups You Should Know.

The chief complaint that I hear about cloud computing isn't that it doesn't exist, but that we've been doing it for years. As that argument goes, ASPs, outsourcing, Web site hosting, and browser-based applications are all forms of cloud computing, so what's really new here?

I'll do my best to answer that. I've come up with seven characteristics that together make cloud computing different from what's come before:

Off-site. A basic principle of cloud computing is that you're accessing IT resources that are in a data center that's not your own. That means you don't buy the servers and storage, someone else does. So-called private clouds are the exception, but forget them for this discussion.

Virtual. IT resources in the cloud can be assembled with drag-and-drop ease. Employing virtualization, cloud service providers let you assemble software stacks of databases, Web servers, operating systems, storage, and networking, then manage them as virtual servers.

On demand. In the cloud, you can add and subtract resources, including number and type of processors, amount of memory, network bandwidth, gigabytes of storage, and 32-bit or 64-bit architectures. You can dial up when you need more, and dial down when you need less.

Subscription style. These tend to be month-to-month deals, often payable by credit card, rather than annual contacts. Amazon charges in intervals of 10 cents per hour for EC2.

Shared. For economies of scale (that's what cloud computing is all about), many service providers use a multitenant architecture to squeeze workloads from multiple customers onto the same physical machines. It's just one of the things that distinguish cloud computing from outsourcing and from hosted data centers.

Simple. Many of the cloud services providers -- whether they specialize in application hosting, storage, or compute cycles -- let you sign up and configure resources in a few minutes, using an interface that you don't have to be a system administrator to understand.

Web based. Others might make this characteristic #1, but I put it last to make the point that there's more to cloud computing than the Web. That said, it does involve browser access to hosted data and resources.

Put them together and you have my definition of cloud computing: Cloud computing is on-demand access to virtualized IT resources that are housed outside of your own data center, shared by others, simple to use, paid for via subscription, and accessed over the Web. The definition applies to server-as-a-service offerings such as Amazon's EC2, as well as to software-as-a-service, storage-as-a-service, Ruby-on-Rails-as-a-service, and so on. Feel free to refine, comment on, or lambast it.

After he teed off, Ellison acknowledged that "we'll do some cloud." Sure enough, earlier in the week Oracle announced that it had entered into an agreement with Amazon to offer its databases and Fusion middleware available on Amazon Web Services and that it had struck a deal with Intel to improve cloud security at the chip level.

Maybe there is something to all of this cloud talk, after all.