SaaS, PaaS, and IaaS and what cloud resources to use

Read our introductory guide to SaaS, PaaS, and IaaS - three types of cloud services.

Hannah Dawson

More and more businesses are offering cloud-based services. As a business owner, it is important to understand the world of cloud-based business. There are three types of service models: software-as-a-service (SaaS), platform-as-a-service (PaaS), and infrastructure-as-a-service (IaaS). Keep reading for this short guide to these types of cloud services.

Sky with a cloud
More and more businesses are offering cloud-based services.

Introducing SaaS, PaaS, and IaaS


SaaS stands for software-as-a-service and describes software available via third parties on the internet. Well-known SaaS platforms include Dropbox, Xero, and Salesforce.


IaaS stands for infrastructure-as-a-service and describes cloud-based, pay-as-you-go services. This includes storage or networking. Well-know IaaS platforms include Amazon Web Services (AWS), Microsoft Azure, and Rackspace.


PaaS stands for platform-as-a-service and describes software tools or hardware available on the internet. Well-known PaaS platforms include the Google App Engine and Windows Azure.

Google logo
Well-known PaaS platforms include the Google App Engine and Windows Azure.

SaaS - explained

A SaaS cloud computing services provider makes software that’s managed by a third party available online. Most SaaS applications can be accessed via your web browser, without any downloads or installations of software required. All technological issues are handled by the SaaS vendor.

SaaS is renowned for its flexibility - it can be amended and upgraded easily. It also tends to be the cheapest of the cloud-based operating systems and can be used in a variety of business areas.

Of course, leaving critical business functions with a third party while service can be terminated at any time (as you do not own the software) can be risky. Also, there are some data security concerns with SaaS, as you are not the sole controller of your data.

IaaS - explained

IaaS is a scalable cloud infrastructure service that offers pay-as-you-go networking, virtualization, and storage. Basically an alternative to physical on-premise infrastructure, IaaS helps companies avoid investing in high-cost on-site resources. IaaS is provided via an API or dashboard. This means clients have control over the infrastructure and are responsible for managing applications, runtime, middleware, and data. IaaS providers manage the hard drives, networking, servers, virtualization, and storage.

IaaS is very flexible and hands over control to the client. It is easy to automate the deployment of networking, servers, storage, and processing power using IaaS.

However, IaaS may not deliver the controls necessary to secure legacy apps, so enhancements may be necessary before you can move them to the cloud. Security can be an issue, as system vulnerabilities or insider threats could expose data communications.

PaaS - explained

PaaS means a cloud service provider offers hardware and software via the internet. This provides developers with a framework to create customized applications. Servers, storage, and networking are managed by the third-party provider and the developers utilizing PaaS usually manage the applications themselves. PaaS provides a software creation platform via the web. They usually include integrated web services and databases, virtualization technology, and a range of services to develop, test, and deploy apps.

PaaS offers a cost-efficient and simple method of developing apps. This means developers can customize apps without needing to expend resources to maintain the software. The amount of coding required is reduced which makes this scalable.

There are operational limits to PaaS which can be reflected in the end user's capabilities. PaaS might not be ideal for apps that need multiple reiterations.

iPhone with apps
PaaS offers a cost-efficient and simple method of developing apps.

Which cloud resources to use

The issues with the different types of cloud services are very similar, mainly around security, cost overruns, vendor lock-ins, and difficulty with customization. Which model is best for you depends on the business goals you have defined for your organization.

Which model is best for you depends on the business goals you have defined for your organization.

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