Cloud computing refers to accessing software and data storage over the internet rather than locally. There are three main types of cloud services - Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS). SaaS provides end users access to online applications, PaaS provides developers platforms to build apps, and IaaS provides network architects computational resources like storage, servers, and networking. Cloud computing offers advantages like reduced costs, scalability, and accessibility but also risks like dependence on providers and potential performance issues.