IaaS vs PaaS vs SaaS: Cloud Computing Service Models

The term “cloud” has become an integral part of modern business practices. Most new projects and startups are launched using cloud-based solutions. They simplify the protection of commercial and personal data, reduce the costs of deploying IT infrastructure, and lower the risks of server breaches aimed at stealing databases or financial information. Many established companies are also considering moving to cloud services as a way to optimize operations.

What Is a Cloud Service

The weakest link in IT services is often the administrator who maintains the server and software. By default, an organization must either keep such a specialist on staff or hire one through an outsourcing contract. This option is not always cost-effective, especially for small companies or those going through financial difficulties. However, it is also impossible to do without technical experts, since their absence increases the risks of downtime and profit loss.

A completely different situation arises when a company rents a SaaS platform:

• The client does not need to buy expensive servers.
• The provider handles updates and software patches.
• The system can be scaled up or down in just a few minutes.

The number of workstations in a cloud-based application can be changed simply by paying for additional accounts or switching to another plan. Similarly, it is just as easy to remove unnecessary accounts and revert to the previous setup. Cloud services are usually provided on a prepaid basis, allowing users to pause or cancel their subscriptions for specific periods, for instance, during a slow season or for a few months or a quarter.

When compared to other industries, cloud systems can be likened to taxi services. When a customer orders transportation, they pay only for the distance or time traveled, without bearing any expenses for vehicle maintenance, driver salaries, insurance, or spare parts. If they owned a vehicle instead, they would have to buy it and handle repairs, fueling, and maintenance.

Benefits of Cloud Infrastructure

To the benefits listed above, we can add at least a dozen more. For example, local IT systems can be migrated to the cloud with relative ease; often, a single software reconfiguration is enough. Office or industrial networking equipment usually continues to function almost unchanged. This means that business owners can avoid costly software purchases and data transfer services.

Other key advantages of SaaS solutions include:

• A significant reduction in the workload of the company’s IT department, which can make it possible to reduce staff or lower outsourcing costs.
• Cloud hosting alleviates internal network strain and prevents router overloads during peak reporting periods.
• Businesses no longer need to buy backup, mirroring, or other systems designed to protect against hardware failures.
• Scalability is so high that connecting a few new workstations in an existing office or setting up a brand-new office for ten employees presents no difficulty at all.

For business owners, several points stand out as particularly important. There are no capital expenditures for equipment purchases, and resources are saved on maintenance and staff. Rapid deployment of workstations makes it easier to open new offices. For startups, it is also possible to rent only the resources required for testing a business plan before committing to long-term investment.

Cloud Service Models

Cloud computing continues to be a rapidly developing technology, partly because there are multiple ways to use it. The SaaS model is only one option, albeit the most common. There are four deployment models for cloud technologies: private cloud, public cloud, hybrid cloud, and community cloud. Each offers a different set of features and capabilities.

Even more interesting is the division by service delivery models:

• SaaS (Software as a Service)
• PaaS (Platform as a Service)
• IaaS (Infrastructure as a Service)

A broader term, XaaS (Anything as a Service), emphasizes that users do not purchase hardware but rent it, or in some cases, pay only for software licenses. All services are delivered virtually and provide only the final result: for example, access to a CRM, a warehouse database, or remote storage.

IaaS: Infrastructure as a Service

Let’s begin with IaaS. Every organization’s infrastructure differs slightly from others, depending not only on the system administrator but mostly on the tasks performed by the network hardware. The IaaS model enables the creation of various configurations based on virtual servers. Providers offering such services typically operate under the public cloud model.

IaaS addresses the following business needs:

• Migrating IT infrastructure to the cloud.
• Quickly launching startups and digital products.
• Creating a backup environment in case of a local server crash.
• Expanding existing infrastructure during business scaling.
• Handling peak loads, for example, during sales or marketing campaigns.

Some companies maintain their own servers for central operations while renting additional capacity for remote branches as needed. This significantly speeds up deployment and saves the valuable time that would otherwise be spent purchasing, setting up, and later upgrading hardware to keep up with growing demands. Virtual resources make it possible to correct configuration mistakes almost instantly and without major financial losses.

Common examples of IaaS include Microsoft Azure, Amazon EC2, Hostman, Cisco Metacloud, Google Compute Engine (GCE), and other public clouds such as Elastic Cloud. Even large enterprises use these services, since renting resources as needed is often more cost-efficient than maintaining proprietary hardware. Renting also removes concerns about equipment failures or insufficient performance.

PaaS: Platform as a Service

Next, PaaS provides “platform as a service,” primarily designed for developers and software testers because it automates routine processes and manages large datasets. A PaaS package often includes development tools, testing environments, and data storage for code and applications.

PaaS platforms solve the following tasks:

• Shortening development cycles and reducing administrative costs.
• Processing Big Data, both historical and real-time.
• Implementing machine learning, for example, image recognition systems.

The PaaS model is suitable for both small mobile applications and large enterprise services. Users can focus on the development process and access ready-to-use development tools out of the box. Time-to-market is greatly improved, regardless of project complexity. Developers can also install additional tools alongside built-in ones.

Examples of PaaS systems include the Containerum Managed Kubernetes Service (a container-based development platform), Azure Stack App Service, and database-as-a-service offerings. Provider pricing is often affordable even for individual developers who need limited resources. Large corporations also use PaaS to build mobile apps for their services, such as delivery platforms and product aggregators.

SaaS: Software as a Service

SaaS solutions are widely familiar: Google Docs, Microsoft 365, and Trello are common examples. Each of these products simplifies collaboration, especially for remote work, and offers flexible pricing options. They are fully ready-to-use, subscription-based services with pricing determined by the number of active users.

In short, a SaaS platform provides:

• Office software for employees.
• Cloud-based tools for freelancers and small business owners.
• Affordable access to otherwise expensive applications.

For example, Adobe offers Photoshop, Illustrator, InDesign, Premiere Pro, and XD through Creative Cloud, and Autodesk provides several products via the cloud. This approach gives users access to high-performance computing resources without the need for costly local hardware.

Beyond flagship products, countless simpler SaaS applications exist, including CRM systems, accounting tools, warehouse databases, website builders, and cloud storage such as Google Drive and OneDrive. Users are now so accustomed to these services that they rarely think of them as cloud-based; an internet outage is usually the only reminder that applications are running on remote servers.

Quick Comparison of IaaS, PaaS, and SaaS

Even with clear definitions, businesses often struggle to choose the right model. Renting a few CRM seats in AmoCRM is one thing; replacing a local server with a virtual machine and migrating CRM databases, inventory systems, and vast document libraries is another.

A practical approach is to start by listing the hardware involved (CPU, RAM, storage, etc.), then select the operating system best suited to your goals. When renting virtual hardware, there is no need to purchase OS or RDP licenses separately, since these are included with access to the virtual machine’s specifications.

Next, calculate the cost of deploying an in-house server room versus renting cloud capacity in a data center, factoring in software, user count, and storage needs. This provides an objective comparison of profitability. Choosing between IaaS, PaaS, and SaaS is not difficult; each has its ideal user: developers typically prefer PaaS, system administrators rely on IaaS, and end users benefit most from SaaS.

Clouds are used for video surveillance storage, virtual PBXs, webinar and video conferencing platforms, and electronic document management. Virtual machines frequently host corporate websites or SMTP servers. These functions are often combined with CRM systems, accounting tools, and other business applications, turning the cloud into a universal platform.

Choosing a Cloud Deployment Model

Migrating to cloud services often stems from limited in-house expertise and the need for full business process automation. If the company employs an experienced IT professional, such questions may not even arise, because that person can handle OS installation, configuration, backup, and maintenance.

It is worth asking the following questions:

• Is the organization large, medium, or small?
• Does it already have its own IT infrastructure?
• Has it purchased equipment for an on-premises server room?
• Does it have qualified engineers and administrators on staff?

The answers will clarify whether cloud services are necessary or if existing resources suffice. Choosing a specific cloud model is rarely a problem. For example, with Hostman’s cloud services, users do not need to understand the internal workings of the cloud; the provider’s support team will handle the setup free of charge.

Cloud Provider Pricing Models

Another important issue is cost: how much will it cost to rent a SaaS application or other cloud service? If the provider frequently increases prices, cloud migration may become unprofitable. It is therefore essential to assess the company’s resource consumption patterns.

The most popular pricing schemes are:

• Pay as You Go: customers pay only for the resources they actually use.
• Reservation Pool: the provider reserves a fixed amount of capacity after payment.

The first model gives clients access to resources as long as they are available; during peak demand, processing speed may temporarily decrease. The second model guarantees consistent resource availability, regardless of load. Each option has its pros and cons, and customers can switch between them easily.

Conclusion

The popularity of cloud services is easy to explain. They provide automation opportunities even for small businesses and independent professionals. The speed of deployment and scaling, along with the flexibility of configuration, make virtual machines far more versatile than local setups. For this reason, cloud computing will continue to evolve, gradually shifting more and more company resources into remote data centers.