Saas vs Cloud are becoming really common in businesses today. According to IDC, global spending on public cloud services is expected to reach $1.35 trillion by 2027, with a growth rate of almost 20 percent each year. They also mention that most companies now use public cloud because it’s a cost-effective option.
SaaS is also growing quickly. Flexera’s 2023 State of the Cloud Report shows that almost half of the companies surveyed plan to switch from on-premises software to SaaS. This is in addition to the 70% of companies already using SaaS apps. Statista also predicts that the SaaS market will increase from $197 billion in 2023 to $232 billion in 2024.
SaaS vs Cloud are often mistaken for the same concept, but they actually refer to different things. Although they share some similarities and benefits, there are clear distinctions between them.
In this blog, we’ll explain each term and compare Saas vs Cloud to give you a complete understanding of both.
What Is Cloud?
‘Cloud services’ describe any service delivered to users over the internet. This includes Software as a Service (SaaS), which falls under cloud services because it is accessed via an internet connection. With cloud services, there’s no need for internal infrastructure or traditional hardware. Instead, all data and applications are stored on remote servers maintained by the cloud provider, simplifying access and maintenance.
What Is SaaS?
TechTarget explained SaaS as a model where a cloud provider hosts software applications and makes them available to users via the internet.
An independent software vendor (ISV) may work with a third-party cloud provider to host the application, but for larger companies like Microsoft, the cloud provider and software vendor might be the same. Since SaaS is delivered online or through a private network, it falls under the umbrella of cloud computing.
With SaaS, there’s no need to install or manage software on your company’s computers or data center, eliminating upfront costs typically associated with purchasing software. The SaaS provider takes care of maintenance, updates, and security.
However, while SaaS providers handle basic data protection, there are limitations, especially concerning advanced data security measures.
Some common SaaS examples are Shopify, Salesforce and Slack.
Read more: Successful SaaS Examples: 5 Success Stories to Inspire Growth
SaaS vs. Cloud Computing
It’s clear that SaaS and cloud services are similar but have their own differences. In simple terms, SaaS is a kind of cloud service, while cloud services is the general term for all services that are delivered over the cloud.
While SaaS is a part of cloud computing, it’s important to understand the differences between them.
1. Scope and Flexibility
Cloud computing provides a broad range of services, including infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS). IaaS offers pay-as-you-go access to computing, storage, and networking resources. PaaS provides a cloud-based environment for developing and testing software applications. SaaS focuses specifically on delivering software over the internet.
2. Data Control and Privacy Considerations
Cloud computing offers greater control over how data is stored, managed, and secured. You can customize your cloud environment to meet privacy and compliance requirements. In contrast, using SaaS means relying on a third-party provider to handle your data, which may affect security and privacy. Tools like Arcserve SaaS Backup can help ensure that your data is backed up and recoverable in case of data loss or ransomware attacks.
3. SaaS Dependence on Cloud Infrastructure
While you can use cloud services without SaaS, SaaS relies on a cloud infrastructure to function. SaaS applications need the cloud to host and deliver their services.
4. Cloud Computing and SaaS Benefits
Adopting cloud computing and SaaS offers businesses numerous benefits, from cost savings and enhanced security to scalability and improved mobility. They help companies to focus on their core operations, drive innovation and stay competitive. You can also read our latest article on Top 10 Benefits of SaaS Development for Your Business.
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5. Efficiency and Cost Reduction
By leveraging cloud-based infrastructure or SaaS, businesses can significantly cut down on IT expenditures such as savings on physical hardware, data center space and energy costs.
Cloud service providers handle all maintenance, updates, and troubleshooting. This eliminates the need for large, specialized IT teams and reduces the ongoing maintenance costs for in-house servers and other IT infrastructure.
With SaaS and cloud computing, businesses can streamline their operations. Automated updates ensure that all software is current, minimizing downtime and ensuring that employees always have access to the latest tools.
6. Data Security
Cloud providers offer robust security measures, including data encryption, multi-factor authentication, and advanced access controls. It protects sensitive data from unauthorized access and cyber threats. Many cloud providers comply with international security standards and regulations like GDPR and HIPAA, which can help businesses meet their own compliance requirements more easily.
Also, for businesses with extremely sensitive data, private cloud models offer an added layer of security by isolating their data and applications from those of other organizations.
7. Scalability
Cloud computing provides businesses with the ability to scale resources up or down based on their needs. They can handle increased workloads during peak times without having to invest in additional hardware that might go unused during off-peak periods. Businesses pay only for the resources they use, making it more cost-effective to scale operations. It is really beneficial for startups and small businesses that need to manage costs carefully while growing.
Cloud services enable businesses to expand their reach globally without the need for a physical presence in new markets. This is ideal for companies looking to expand their operations quickly and efficiently.
8. Disaster Recovery
Cloud services typically include automatic data backups, ensuring that data is consistently saved and can be quickly restored in the event of a system failure or data loss. In the event of a disaster, cloud computing enables businesses to recover their data and applications quickly, minimizing downtime and reducing the impact on operations.
Many cloud providers use geographically dispersed data centers, which means that even if one data center goes down, the data can still be accessed from another location.
9. Control
Cloud services offer detailed access controls, allowing businesses to grant or restrict access to data and applications based on roles and responsibilities. So, sensitive information is only accessible to authorized members.
Related Article: Why Your Business Should Move to the SaaS Model & How to Do It
What Are the Different Types of Cloud?
While Software as a Service is the most common cloud service found in organizations today, there are two other main types: Infrastructure as a Service (IaaS) and Platform as a Service (PaaS).
Infrastructure as a Service (IaaS)
IaaS is a cloud-based service that provides users with on-demand access to computing resources and infrastructure via an internet connection. This includes storage, networks, operating systems, servers, and virtual machines, essentially offering the entire data center framework needed to run cloud services.
Like SaaS, IaaS is often available on a pay-as-you-go basis, allowing businesses to adjust their resources as needed without significant upfront investment. This flexibility helps reduce costs associated with physical infrastructure and on-site installations. IaaS customers have full control over the infrastructure through dashboards or APIs, similar to managing a traditional data center, but without the physical maintenance.
Unlike SaaS, however, users are responsible for managing their own applications, runtime, operating systems, middleware, and data.
Platform as a Service (PaaS)
PaaS is a cloud platform for developers to create custom cloud applications without having to manage the underlying infrastructure, such as servers, storage, networks, and databases.
Unlike SaaS, which delivers software over the internet, PaaS delivers a platform for software development, allowing developers to focus on building applications without worrying about the supporting infrastructure.
Your third-party provider typically manages and maintains all servers, storage, and networking unless specified otherwise. This setup allows developers to concentrate on creating applications and achieving broader business goals without the hassle of IT system maintenance.
Check out our article on Why SaaS Is The Future.
The Future of Cloud vs SaaS
As cloud technology advances, it becomes more complex. Some parts of a system can be in the cloud, while other parts can be on local servers. In the information age, cloud products do something special that on-premise products don’t: they collect lots of anonymous data and use it to improve user experience. For example, Tesla uses this data to make their cars safer, and Spotify suggests new music you might like. The growth of cloud-based platforms makes this future possible.
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