When I first started working in the tech industry, I'll admit that it took me a while to figure out the answer to a question that was top-of-mind for me:

What the heck is "the cloud?"

It seemed like such a simple question, I didn't have the courage to come out and ask it. So, like any good blogger, I resorted to the internet to figure it out.

And what I learned is, "the cloud" is a pretty big deal that powers how a lot of modern technology companies operate.

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You see, the cloud refers to how and where data is stored -- and perhaps more importantly, where it isn't. The cloud allows software and services to run on the internet, instead of only locally on one device, because the data is stored remotely across a variety of different servers. These software and services can be accessed on any internet browser, or via online apps that can be accessed on different devices.

One key example: the cloud lets your team collaborate on Google Docs instead of forcing you to work on one Microsoft Word document and send it around to each other.

As you might have guessed, thinking about all of the other services you can access from any online device, the cloud is a big deal. You might also be wondering, how are these cloud-based services built? You'll learn how different cloud computing services are used to build the technologies you use every day in this blog post. And if you're still confused about the cloud, don't worry -- clearer skies are ahead.

IaaS vs. PaaS vs. SaaS: What's the Difference?

IaaS, PaaS, and SaaS stand for the three main categories of cloud computing. Cloud computing is the practice of using a network of different servers that host, store, manage, and process data online -- in "the cloud" I mentioned earlier. Here's a breakdown of the different ways businesses are monetizing cloud computing to offer customers different types of online services:

IaaS customers can control their own data infrastructure without having to physically manage it on-site. Instead, they can access and store data on servers via a dashboard or API (application programming interface).

What does IaaS do?

IaaS helps companies build and manage their data as they grow, paying for the storage and server space that they need to build hardware or software, without having to actually host and manage servers themselves on-site. IaaS products make up the foundations of building new technologies delivered over the cloud.

IaaS Examples

1. Amazon Web Services (AWS)

AWS is overseen by Amazon and is used for on-demand cloud computing and purchased for on a recurring subscription basis. AWS helps companies store data and deliver content -- in fact, it's helping you read this blog post right now.

2. Microsoft Azure

Microsoft Azure is a cloud-computing IaaS product that allows for building, testing, and managing applications through a network of Microsoft data centers.

IaaS Pros & Cons

IaaS cloud infrastructure offers companies and administrators the greatest level of control and power over software and hardware, but they'll also be responsible for making sure they're technologically secure and running properly to avoid causing outages in critical parts of your company's operations.

In this way, PaaS isn't delivering software over the internet, but it is providing an online platform that's accessible to different developers to create software delivered over the internet.

What does PaaS do?

PaaS products let developers build custom applications online without having to deal with data serving, storage, and management.

PaaS Examples

1. Google App Engine

Google App Engine allows developers to build and host web applications in cloud-based data centers that Google manages.

2. OpenShift

OpenShift is an on-premises containerization PaaS software.

PaaS Pros & Cons

The biggest advantage of the PaaS model is how much control it provides IT administrators over the platform software and applications are being built upon. The disadvantage of the PaaS model is you can only control what's built on the platform -- if there is an outage or issue with the hardware or operating system that platform is built on, it will take out the software with them.

Next up, let's dive into SaaS -- the acronym you're likely most familiar with.

What does SaaS do?

SaaS products are among the most commonly-used cloud computing services used by companies to build and grow their businesses. SaaS is easy to use and manage, and it's highly scalable, as it doesn't need to be downloaded and installed on individual devices in order to deploy it to an entire team or company. This is particularly helpful for distributed global teams of people who don't work in close physical proximity.

SaaS Examples


JIRA is a project management software that's delivered by Atlassian and can be purchased on a subscription basis by customers.

2. Dropbox

Dropbox is a file-sharing SaaS tool that allows multiple users within a group or organization to upload and download different files.

SaaS Pros & Cons

The biggest advantage of using SaaS products is how easy they are to set up and start using: Because SaaS products are cloud-based, all you need to do is log online to start accessing the online applications and start using them, without need for locally hosting the software on servers on the premises of your office or business.

However, this ease of use lends itself to the disadvantage of using SaaS products: When you use a SaaS product, you have no control over the cloud-based infrastructure it runs on, so if the software provider experiences an outage, so do you. This can lead to widespread website outage and issues that can, in turn, impact your business processes that require SaaS products to operate.

What's the Difference?

To examine the differences between IaaS, PaaS, and SaaS, think of these terms as under the umbrella of cloud-computing (building, creating, and storing data over the cloud), and think about them in the order we've presented them. We'll go into more detail, but the chart below outlines some of the key differences between each one.saas-vs-paas-vs-iaas

Source: Big Commerce

Every type of cloud-computing is different and has pros and cons that vary from the rest. Understanding the structure of each one will help you determine the right approach for your business.

To start, let's begin with comparing IaaS to PaaS. 

Let's say I wanted to start a website. I would need an IaaS product, like Amazon Web Services, to host it and its applications. If I wanted to create a custom feature, I could use a PaaS product like Google App Engine to design it and install it on my site. 

IaaS builds the infrastructure of a cloud-based technology. PaaS helps developers build custom apps via an API that can be delivered over the cloud. And, SaaS is cloud-based software companies can sell and use.

Think of IaaS as the foundation of building a cloud-based service -- whether that's content, software, or the website to sell a physical product, PaaS as the platform on which developers can build apps without having to host them, and SaaS as the software you can buy or sell to help software companies (or others) to get it all done.

Now, let's compare SaaS to PaaS. 

For example, if I wanted to create an app for my business, I would use a PaaS product. This would act as the platform for my app to run on. Once it was finished, my app would be considered SaaS. That's because my software application is now providing a service to its users.  

With both products, there's a risk of external management data issues compromising the functionality or security of the tools you're using. SaaS is best for companies looking for an out-of-the-box ease of use, and PaaS is best for companies looking to build a solution on an existing network.

Next, learn more about SaaS customer acquisition.

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Originally published Sep 12, 2019 4:47:00 PM, updated February 28 2020