Cloud computing
The three service models: IaaS, PaaS and SaaS
Cloud services are commonly grouped into three models that differ by how much of the technology stack the provider manages versus the customer. Choosing the right model depends on how much control and how much operational responsibility a business wants to keep in-house.
- IaaS (Infrastructure as a Service): the provider supplies virtualised compute, storage and networking. The customer manages the operating system, runtime and applications. It offers the most control and is suited to teams that need to configure their own environment.
- PaaS (Platform as a Service): the provider manages the underlying infrastructure plus the runtime, operating system and middleware. The customer focuses solely on building and deploying applications, which shortens development cycles.
- SaaS (Software as a Service): the provider delivers a complete, ready-to-use application over the internet, typically through a browser. The customer manages only its data and user accounts, with no installation or maintenance.
The three models also differ by deployment context. Public cloud shares infrastructure across many tenants, private cloud dedicates it to a single organisation, and hybrid cloud combines both to keep sensitive workloads in-house while bursting to public capacity when needed.
Comparing the cloud service models
| Criterion | IaaS | PaaS | SaaS |
|---|---|---|---|
| Provider manages | Hardware, virtualisation, networking | Infrastructure plus runtime and middleware | Entire application stack |
| Customer manages | OS, runtime, applications, data | Applications and data | Data and user accounts only |
| Level of control | High | Medium | Low |
| Typical user | System administrators, infrastructure teams | Developers | End users and business teams |
| Example use | Hosting custom virtual machines | Deploying a business application | Using an email or CRM tool in the browser |
A single organisation often combines all three: a SaaS tool for email, a PaaS environment to deploy an internal application, and IaaS for workloads that require granular configuration.
Why cloud computing matters for SMEs
For small and mid-sized businesses, cloud computing removes the need for large upfront investment in servers and data-centre space. Resources are billed on consumption, which converts capital expenditure into predictable operating costs and frees capital for the core business.
- Elastic scalability: capacity can be increased during peak periods and reduced afterwards, so a business pays for what it actually uses rather than for permanent over-provisioning.
- Faster time to market: environments can be provisioned in minutes, letting teams launch and iterate on applications without procurement delays.
- Lower maintenance burden: the provider handles hardware upkeep, patching and physical security, reducing the need for a large in-house infrastructure team.
- Accessibility and continuity: resources are reachable from any internet connection, supporting remote work and built-in redundancy across multiple locations.
The trade-offs to plan for are dependence on internet connectivity, recurring subscription costs that need monitoring, and a shared responsibility model where the provider secures the infrastructure but the customer remains responsible for its own data, access management and configuration.
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