Cloud computing provides on-demand access to shared computing resources like networks, servers, storage, applications and services that can be rapidly provisioned with minimal management effort. It has five essential characteristics: on-demand self-service, broad network access, resource pooling, rapid elasticity, and measured service. There are three service models - Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS) - and four deployment models: private cloud, community cloud, public cloud, and hybrid cloud. Cloud computing aims to maximize efficiency and minimize costs through dynamic provisioning, multi-tenancy, and pay-per-use models.