The advantages are in ease of use, being able to see your most popular/most posted to tags and space saving. For a far better definition of tag clouds check out the Wikipedia page. I use Wikipedia a lot which I access via a search engine extension to Firefox, my favorite web browser by far. 
The above two were just the first I came across. There are a number of other sites that offer tag clouds although not have the facility to include the code on your pag. A google search revealed:
- 43things tag listing
- del.icio.us
- Flickr most popular tags of photos
- Last.fm -
tags of listings - Tag Clouds
- Technorati most popular tags of blogs
Del.icio.us: Tagging

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