What exactly is cloud computing?

I hear a lot about it in the news but really don't understand it. What are its advantages and disadvantages?What exactly is cloud computing?
Cloud computing is Internet-based computing, whereby shared resources, software and information are provided to computers and other devices on-demand, like the electricity grid.



The term "cloud" is used as a metaphor for the Internet, based on the cloud drawing used in the past to represent the telephone network, and later to depict the Internet in computer network diagrams as an abstraction of the underlying infrastructure it represents



Refer to the wikipedia link. Its best explained with picture and diagrams.What exactly is cloud computing?
This is a rather large topic to explain in a small post and Wikipedia does have good explanations of cloud computing. Also, if you want to see an example of cloud computing provider, check out http://www.eccentex.com