I must admit I'm slightly struggling to see how the cloud is substantially different in concept to the likes of the VaxCluster technology that appeared in the 1970s. Though I guess it doesn't have to be: reinventing old things with new and exciting names makes them, well, new and exciting!
The concept is similar to load-balancing across a server farm, except that it's done on a larger scale with servers that could theoretically be spread all over the internet and more factors are taken into account in terms of optimizing performance (distance to the server, protocols, client types, etc.) In many cases the distribution of resource and propagation of changes is also optimized based on demand against servers across the cloud. It actually is pretty cool stuff.
What I don't understand is why end-users are excited about it. It's awesome stuff for the IT geeks managing resources, but from the consuming end the client software doesn't behave differently than it would if everyone was using the same central server. It's become a bit of a marketing buzzword, methinks.