SaaS vs. PaaS vs. IaaS: Which One Is Right for Your Business

Thinking about moving your business operations to the cloud, you need to learn the difference between – SaaS vs. PaaS vs. IaaS. 

SaaS vs. PaaS vs. IaaS: Learn the difference between the three four-letter acronyms that have changed the way businesses operate better.

The cloud has become a big deal in today’s hyper-connected era. Businesses resort to it because it reduces the need for building a physical data center. In this way, it helps them save money, streamlines many tasks, improves collaboration, and ensures faster business growth. 

However, “the cloud” is a broad term. There is no one-size-fits-all solution for all businesses. The cloud is where your data is stored and is hyper-connected to how it is stored. 

If you have been considering migrating your business operations to the cloud, you have probably come across these terms: SaaS, PaaS, and IaaS. 

They stand for the fundamental categories of cloud computing. Each cloud service model has several advantages and disadvantages regarding data security, flexibility, and performance. This guide will help you determine which one is right for you.

What is the difference between IaaS, PaaS, and SaaS?

SaaS: SaaS software that’s available via a third party over the internet. PaaS: Paas hardware and software tools are available over the internet. IaaS: IaaS cloud-based services, pay-as-you-go for services such as storage, networking, and virtualization. 


IaaS, or infrastructure as a service, vendor deliverers cloud-based infrastructure resources to your business through virtualization technologies. 

This service is often delivered through a dashboard or an API, meaning your business will fully control the cloud infrastructure. 

Investing in IaaS is similar to building a traditional on-site data center regarding control, data security, and technologies. The only difference is that you do not need to physically maintain and manage your infrastructure. 

Servers, hard drives, virtualization, networking, and storage are outsourced to the cloud and managed by the IaaS vendor. Unlike SaaS or PaaS users, IaaS users must independently manage applications, middleware, data, and runtime.

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When to Use IaaS?

Startups and SMBs may prefer IaaS because it has the traits of the traditional data center without purchasing expensive hardware and software components. 

Larger enterprises may also reap many benefits of IaaS. Namely, they will maintain complete control of their applications, data, and infrastructure and pay only for what they use. IaaS is impressively flexible, letting small and large businesses scale specific hardware and software needs up and down as their business demands change.

The Major Benefits of IaaS

One of the most significant benefits of IaaS is increased data security. Namely, your team can implement third-party security services into their existing IaaS infrastructure. 

This is particularly important to large enterprises and organizations operating in highly regulated industries, such as government, financial, legal, or medical, where the safety of their sensitive data is their top priority. 

To manage all components and apps seamlessly on the cloud and reduce security risks, many enterprises and companies in regulated sectors choose private cloud providers that offer hyper-converged infrastructures. 

HCI simplifies the traditional complex cloud infrastructure and helps them develop business-driven data centers on the cloud, whether using private, hybrid, or industrial cloud.

IaaS also ensures greater uptime and eliminates single points of failure. Namely, an IaaS provider will scatter your resources across multiple servers and data centers. Therefore, your company’s infrastructure will not be harmed if a server goes offline.

As I have mentioned above, both large and small businesses can benefit from the high flexibility of IaaS. You are paying only for the resources and servers you use. As your business needs grow, you can easily scale your infrastructure up.

The Major Disadvantages of IaaS

Your IT teams are responsible for maintaining and upgrading software. This provides you with greater data control but requires equipping your teams with proper tools and ongoing employee training and education. 

You may face many problems migrating legacy apps when investing in traditional cloud solutions. 

Due to the lack of reliability guarantee for traditional cloud computing architectures, you may need to make a minor change to your legacy apps before moving them to the cloud, which may, again, lead to new security issues. 

This is where, again, investing in an HCI-based cloud can help, as it will make specific optimizations to meet the high requirements of stability and network security for your critical applications. 


PaaS is short for “platform as a service,” primarily used by developers. A PaaS vendor provides platform developers can use for unique and customizable software. 

When investing in PaaS, developers can create applications without worrying about menial tasks, such as data serving, storage, software updates, or infrastructure. 

When to Use PaaS?

PaaS is especially popular among businesses that want to build their software or applications without spending a fortune or risking their security. It is like building your company headquarters from scratch vs. renting office space. 

In the latter example, you get fully equipped office space you can customize to your specific needs. The same goes for PaaS. The platform is available to numerous developers via the same development application. Developers further create authentic apps that are built into the PaaS. These apps are called middleware.

The Major Benefits of PaaS

The major benefit of PaaS is that it builds on virtualization technologies. This means the resources are easily scalable, depending on your current business needs. 

PaaS vendors also offer many services to help developers create, test, and implement apps. 

They allow developers to customize software without needing to write additional lines of code. Finally, with PaaS, you can easily migrate to the hybrid cloud infrastructure. 

The Major Disadvantages of PaaS

There are several limitations of PaaS infrastructures you should consider, including. First, there are many data security concerns, given that you give your data to a third-party provider. Second, there are many operational issues to consider.

You control only what is built on the platform. If the operating system breaks, your software will also be unavailable. Third, customizing legacy systems is extremely complex and requires significant time investments, which dwarfs the overall PaaS investment.


SaaS stands for software as a service. Those are cloud-based services that are hosted online by a SaaS company. SaaS services are delivered to customers via the internet, usually for a monthly subscription fee.

SaaS is the most common choice for businesses of all shapes and sizes, given that it is easy to use and manage.

Apps usually run through your browser, meaning you do not need to download or install anything on your employees’ devices to run an app. SaaS is particularly important to businesses hiring remote teams.

When to Use SaaS?

SaaS models work for companies of all shapes and sizes. Still, they can benefit startups and small businesses with limited time and resources.

With SaaS, they can set up online stores faster and improve team collaboration. It is especially important if you are hiring remote teams and want to keep your data available 24/7 via web and mobile apps.

The Major Benefits of SaaS

Businesses like SaaS models because they save time and for IT teams and save money. Instead of installing and managing applications on each computer or keeping operating systems up-to-date, your technical staff will have more time to dedicate to pressing matters within your company.

Simply put, when investing in SaaS, you are neither responsible for hardware nor software maintenance. This is the SaaS vendor’s responsibility. They will manage data, servers, storage, and technical issues, streamlining your operations and allowing you to grow faster. 

Above all, SaaS minimizes communication gaps and improves workplace productivity. Whether your employees work from your offices or remotely, they need to log in to access relevant data in real time.

The Major Disadvantages of SaaS

This ease of SaaS solutions also comes with greater security risks. Namely, when using a third-party SaaS application, you have no control over the cloud infrastructure it runs on.

For instance, unplanned maintenance, online attacks, natural disasters, or network issues may impact your app’s performance and harm your overall business operations.

Another great problem associated with SaaS vendors is the lack of customization. Namely, the SaaS vendor offers specific, predetermined integrations, functionalities, and features

Understanding the Difference between PaaS, IaaS, and SaaS

SaaS vs. PaaS vs. IaaS, as explained above, have differences depending on the application.

From the examples mentioned above, we can conclude that the growing popularity of the cloud is minimizing the need for on-premise hosting. You must choose the right solution for your business, depending on its specific needs. If you are still unsure about the significant differences between these three cloud computing server models, this brief recap will help you.

  • IaaS: A vendor manages virtualization, servers, storage, and networking. You manage apps, data, runtime, middleware, and operating systems. 
  • PaaS: A vendor manages virtualization, servers, storage, networking, runtime, middleware, and operating systems. You maintain data and applications. 
  • SaaS: A vendor manages virtualization, servers, storage, networking, runtime, middleware, operating systems, data, and applications. You have nothing to worry about.

Each of the servers mentioned above provides your business with multiple benefits, such as greater flexibility, data security, and scalability. Above all, they will improve your company’s bottom line in various ways, from reducing the need for expanding your IT team to saving money on hardware and software components.

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General FAQ for SaaS vs. PaaS vs. IaaS

What is SaaS?

Here’s a simple SaaS definition: a software distribution model in which a service provider hosts applications for customers and makes them available to these customers via the internet.

What is PaaS?

Platform as a service (PaaS) is a cloud computing model in which a third-party provider delivers hardware and software tools — usually those needed for application development — to users over the internet.

What is IaaS?

Infrastructure as a service (IaaS) is an instant computing infrastructure provisioned and managed over the internet. It’s one of the four types of cloud services: software as a service (SaaS), platform as a service (PaaS), and serverless.

What are examples of SaaS, PaaS, and IaaS?

SaaS: Google Apps, Dropbox, Salesforce, Cisco WebEx, Concur, GoToMeeting. PaaS: AWS Elastic Beanstalk, Windows Azure, Heroku,, Google App Engine, Apache Stratos, OpenShift. And IaaS: DigitalOcean, Linode, Rackspace, Amazon Web Services (AWS), Cisco Metapod, Microsoft Azure, and Google Compute Engine (GCE).

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