To put it simply, “the cloud” is a generic term for the physical place (or rather, places) where all of the applications and services live. If you’ve seen an action movie in the past decade, it’s common plot point now for a character to need to break into a “server farm” which is usually a large, sterile room filled with servers (also called “black boxes” give their appearance) and sporadic blinking lights. A server farm is a perfect example of one of the cloud’s many homes.
If you’re older than 17, chances are the computers you remember from the past are much different than the ones we have now. If you wanted to create a birthday card or play a game, you had to plug in a CD rom, USB, floppy disk, or some other (now antiquated) form of storage device to your tower PC and wait for the application to install. It was slow, excruciating, and often time consuming. Now, instead of downloading that software to your own personal computer, you can use the internet to access a server somewhere else that already has the software downloaded and use that application for yourself with a personal account. No more waiting for installations, updates, or losing storage space on your computer — instead, you can access an up to date version of the software at any moment and begin working immediately through the cloud.