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SaaS Vs PaaS Vs IaaS – An Ultimate Guide On When To Use What

SaaS Vs PaaS Vs IaaS – An Ultimate Guide On When To Use What

Once you decide to build a technology solution, you start following the latest technology trends and probably one of the first things you hear about is Cloud Service. Zillions of articles are written about Cloud service, its advantages and challenges, how to choose the best vendor and so on. But are you still confused about what the heck is SaaS, PaaS and IaaS? Well, you are not alone. There are some crucial differences but the choice gets difficult in case you are not aware of the nuances of these three models.

Here we try to address some fundamental questions related to these three options. The article below will guide you what each of these options mean, what are the salient features and which one to choose when.

Let me share a basic diagram demonstrating the difference between these. Don’t worry, if you find this overwhelming. A detailed explanation is to follow  –

SAAS Vs PAAS Vs IAAS To start with, let us understand what Cloud Computing means.

Consider that you have a server on-site with your Enterprise software services and its database. This incurred an initial investment in terms of IT infrastructure and a physical location, and there are gradually growing costs involving maintenance. To avoid these costs, enterprises turn towards Cloud Computing Service vendors that provide the same or advanced infrastructure as per your specifications on a rental basis.

Cloud is a platform that hosts a pool of computing resources over the Internet as a convenient, on-demand utility to be rented on a pay-as-you-go basis. Hence all Clouds are basically virtualized data centers made up of computation and storage resources.

The term Cloud computing services comprises all the services which are hosted over a Cloud. Hence Cloud Computing is the utilization of services such as storage, applications, and servers, over the cloud, on-demand and in a dynamically scalable fashion.

Most organizations go for Cloud services to reduce their investments in infrastructure costs, maintenance costs and ensuring the availability of resources round the clock. Cloud Computing is more efficient and cost-effective solution than traditional data centers.

Typically, cloud services have following characteristics -

  • User is able to avail the services fairly quickly as compared to traditional IT by simply signing up for the services.
  • User is able to access the service via multiple platforms such as laptop, desktop, mobile etc.
  • The resources (computers, databases and servers) are shared across multiple users
  • There is scalability and flexibility to increase capacity as the demand increases
  • Metered billing based on the actual usage which is delivered automatically

Software as a Service –

SaaS is the most popular and known form of cloud service for consumers.

As part of SaaS the third-party vendor provides the organization with the entire stack to be procured on a pay-as-you-go basis. SaaS provides you the complete freedom to work on the procured software without worrying about how the infrastructure or even how the underlying software is maintained.

The popular vendors of SaaS are Microsoft 365, Zoho, Salesforce, SAP, Google G Suite and more.


SaaS Characteristics:

  • Software is hosted on a remote server and is always accessible through a web browser over Internet
  • Application is managed from a central location
  • Application users don't need to worry about hardware, software updates and patches
  • Any integration with the third party applications are done through APIs


When should you use SaaS - 

  • Applications where the demands spike or reduce significantly – For example: taxation software has high demand during tax filing season, hotel reservations see a spike during holiday season and so on
  • Applications which have demand for web as well as mobile access – For example: Sales management software, CRM systems
  • Short term projects which require collaboration – the pay-as-you-go model makes it convenient to quickly setup and use
  • Start-up businesses which want to quickly launch ecommerce sites without worrying about server configurations and software updates

Platform as a Service –

PaaS is where coupled with the underlying hardware, the third-party vendor provides middleware, operating systems, and tools required to develop and test applications. This differs the procuring organization from the cost of maintaining, patching or any kind of capacity planning required for your underlying platform.

The common vendors providing PaaS are AWS, Salesforce.com, Microsoft Azure, Oracle Cloud, SAP and OpenShift among others.

Developers work on PaaS platform and concentrate on software application building without having to worry about software updates, operating systems, load balancing, storage, or other details related to infrastructure.


PaaS Characteristics:

  • Built on top of virtualization technology – you can demand for resources as per your need and scale up/ down as per the requirement

  • Provides varying services to facilitate development, testing, deployment and hosting of software applications in integrated development environment
  • Multiple users can utilize the same development application
  • Integrated web services and databases
  • Billing and subscription is managed by tools


When should you use PaaS - 

When multiple developers are working on the development or when external parties are involved in the development process, PaaS is a great option to bring in the speed and flexibility to the development process

  • For organizations following Agile Methodology for software development, PaaSeases the difficulties associated with rapid development and iteration of application
  • When you wish to spread your Capital Investment – by providing the underlying solid infrastructure, PaaS model reduces the organization’s overhead costs
  • Large organizations who want to customize applications

Infrastructure as a Service –

IaaS is where virtualized computing infrastructure is provisioned and managed for businesses by Cloud vendors. The IT resources that are offered in IaaS include storage, servers and networking utilities over the internet.

Major companies that provide IaaS are AWS, Rackspace Open Cloud, IBM Smart Cloud, Microsoft Azure and more.


IaaS Characteristics:

Generally includes multiple users on a single piece of hardware

  • Resources are available as a service
  • Allows dynamic scaling capabilities – the cost varies based on the infrastructure selection
  • Very flexible cloud computing model and gives organizations a complete true control over their infrastructure


When should you use IaaS -

  • Ideal for organizations which need complete control over their high performing applications

  • Also suitable for startups and small companies which do not wish to spend time and energy in procuring hardware and software.
  • Suitable for growing organizations which are not yet sure about the application and expect it to evolve over a period and hence do not want to commit to hardware/ software resources
  • Suitable for applications which see volatile demands – where scaling up or down is critical based on traffic spikes or valleys


Saas, PaaS or IaaS – each of these cloud models offer specific features and functionalities and it is critical that businesses make a prudent choice based on their specific requirements. There is always a learning curve but there are tremendous benefits of moving to these platforms.