Three common cloud service models are Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (Iaas).
Think of cloud services like renting different types of tools or resources you need, instead of owning them outright. Just like you might rent a car, borrow a power tool, or use a co-working space, you can rent different types of services in the cloud based on what you need, whether it’s a ready-made software, a platform to build on, or the raw computing power to support your business.
For example, renting a car could be compared to Software as a Service (SaaS). You pay for access to a fully functional, ready-to-use car (or software) without needing to maintain it yourself. Borrowing a power tool is more like Platform as a Service (PaaS). You have access to the tool (or platform) but still need to do the work yourself. Lastly, using a co-working space is like Infrastructure as a Service (IaaS). You’re renting the basic infrastructure (like office space or servers), but you're responsible for how you use it.
Here's how it breaks down:
A Software as a Service (SaaS) delivers complete ready-to-use, cloud-based applications via the internet on a subscription model. SaaS applications are typically multi-tenant and process flows are already defined in the system. The cloud provider frequently develops new features and capabilities that are installed in customer systems during release upgrades delivered on a set schedule.
For example, if I need a software solution with predefined business processes to facilitate selling my products or services to customers, processing the incoming orders, and maintaining a universal journal of my financial data, I might purchase an Enterprise Resource Planning (ERP) SaaS solution such as SAP S/4HANA Cloud Public Edition. If I need a software solution with predefined business processes for managing the employee lifecycle at an organization, from recruiting and hiring to onboarding and development, I might purchase some or all of the solutions within the SAP SuccessFactors suite.
A Platform as a Service (PaaS) is a cloud-based solution that gives developers access to an application development platform, including development tools, operating systems, middleware, and databases, using virtualization. Developers can develop, test, and manage applications in the cloud without having to maintain the underlying platform.
For example, if I want to design a mobile app that consumes data from my SaaS solution and can run on iOS and Android devices, I might subscribe to a service that supports mobile app development such as Mobile Services running on the SAP Business Technology Platform. Within the service, I can develop, configure, and manage my new mobile application.
An Infrastructure as a Service (IaaS) is a cloud service that allows organizations to rent or lease virtual computing resources, such as infrastructure, processing power, storage, and networking components on-demand from a third-party provider. This is beneficial, because renting or leasing is always less expensive than purchasing your own hardware, and you can still maintain a deep level of control over the infrastructure.
For example, if I have thousands of pictures that take up too much space on a laptop hard drive, I could subscribe to a document storage service like iCloud, Google Drive, Dropbox, or others and upload my photos there. The IaaS provider is delivering a storage service that runs on their servers. They host the infrastructure and handle tasks like system maintenance and backups, so customers don't have to.