[pedoh]

Suppose you have a website that has completely constant traffic. You can therefore anticipate exactly how much computing power you need, and a dedicated machine or two will suit your needs well.

Now suppose that same site (hosted on two dedicated machines) gets a sudden increase in traffic, beyond the capabilities of your two machines. Instead of reserving another dedicated machines, spool up a cloud instance (or two) to help handle the traffic, and once the traffic returns to normal, release the cloud instance(s).

Here's another possibility. Suppose you need 100 machines to crunch data for an hour. Launch 100 cloud server for that hour at their rate and you pay 100 x $0.15 = $10.50 for the hour instead of 100 x whatever they'll charge for a month of dedicated machine usage.