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In the case of Microsoft 365, “the cloud” is comprised of many computers working together to form a file repository. These computers contain redundancies within themselves: if a hard drive fails, it is replaced by a new drive. The computer then looks at the other hard drives and performs calculations to figure out what data was on the failed hard drive and automatically reconstructs the data. This setup is named RAID (redundant array of independent disks). In the enterprise world, RAID arrays can suffer multiple disk failures without losing data.
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