SaaS VS PaaS VS IaaS in 2019: All the Differences and Comparisons You Need to Know

SaaS PaaS IaaS

As the cloud computing technology continues its rapid development, impacting almost every industry around the world, the topic regarding ‘SaaS PaaS IaaS’ has become increasingly popular. So, what are the differences between SaaS, PaaS, and IaaS? Simply speaking, SaaS, PaaS, and IaaS are three most essential operating models in the global cloud computing service market, also known as Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS). Each of these cloud computing model has its own characterises and benefits, therefore can serve in different applications for different business needs. This blog will explain everything you need to know about ‘SaaS PaaS IaaS’.

‘SaaS PaaS IaaS’: Three Main Models in the Global Cloud Computing Market

Global cloud computing market size is booming, driving the demand for SaaS, PaaS and IaaS segments around the world. According to the latest market research from Technavio, the global cloud computing market size is forecast to grow by US$190.32 billion from 2019 to 2023, representing an impressive CAGR of over 16% during the forecast period.

Nowadays, enterprises across the globe are focusing on reducing their overall CAPEX. As a result, they are increasingly moving toward cloud services for their computing needs. Apart from CAPEX reduction, cloud computing solutions can facilitate faster storage, processing, and communication lines. Clouds also enable the deployment of applications without the need for provisioning hosting capabilities. Furthermore, cloud services provide security, facilitate optimum use of resources, and provide reliability of a normal dedicated server and cloud resources. These factors are increasing revenue generation for vendors, contributing to the growth of cloud computing market size.

SaaS VS PaaS VS IaaS: What are the Differences?

As the three main models in the global cloud computing market – ‘SaaS PaaS IaaS’ are providing different cloud services to meet different business needs. Hence, these three models are also referred as cloud application services, cloud platform services and cloud infrastructure services.

What is SaaS

SaaS, short for Software as a Service, is a software distribution model utilizes the internet to deliver software applications. SaaS is normally managed by a third-party vendor, but users can access to it regardless where and when they are. Since majority of SaaS applications are run directly through the internet, and do not require any downloads or installations by users, it’s now one of the most common segments and represents the largest market share in the global cloud computing service market.

Global Software as a Service (SaaS) Market Overview

The adoption of SaaS helps enterprises in eliminating expenses and complexities associated with managing hardware and software required to run applications. Moreover, SaaS also enables easy access to IoT, data analytics, and AI platforms which aids businesses in making business decisions. As a result, there will a high demand for SaaS solutions. The latest market research from Technavio shows that the global SaaS market size will grow by USD 60.36 billion from 2019 to 2023, representing a CAGR of over 9% during the forecast period. Certain factors that are driving the market include augmenting use of mobile apps, increased use of AI-enabled SaaS, and rising need for API connections.

Vertical SaaS is suitable for specific industries such as retail, insurance, and auto manufacturing. Industry-specific vertical SaaS is cost-effective and can refine customization. It can generate industry-specific customer data and intelligence, which are essential for enterprises to cater to customer needs within their niche. Vendors are constantly focusing on proving vertical SaaS with features specific to client needs to increase their customer base. Such factors are expected to be some major SaaS trends to driving the market growth over the near future.

Top SaaS Companies

Adobe Inc.

Microsoft Corp.

Oracle Corp. Inc.


SaaS Examples

Some of the most popular SaaS examples: BigCommerce, Google Apps, Salesforce, Dropbox, MailChimp, ZenDesk, DocuSign, Slack, Hubspot.

What is PaaS

PaaS, stands for Platform as a Service, is a cloud-based platform services that provide an online platform allowing users to build, operate and manage their applications through particular frameworks. PaaS is often acknowledged as a quick, simple and cost-effective solution for enterprises to develop, test and operate their one cloud applications. With the adoption of PaaS, enterprise or a third-party service provider can manage servers, storage, and networking, while the developers can maintain management of the applications.

Global Platform as a Service (PaaS) Market Overview

PaaS model provides software development tools, APIs, and code to help organizations streamline their application development. The model also supports complete application lifecycle and reduces the burden on enterprises regarding the maintenance and up-gradation of servers. The PaaS model eliminates unnecessary human configuration tasks and simplifies the tasks of application developers. Owing to such advantages, businesses are increasingly adopting PaaS solutions, which is driving the growth of the global platform as a service market during the forecast period. According the Technavio recent market report, the global PaaS market size will grow by USD 28.4 billion during 2019-2023, registering a strong CAGR of nearly 22% over the next five years.

The emergence of video communication PaaS is one of the major global platforms as a service market trends influencing growth. Video communication PaaS is adopted in end-user industries for training employees, meetings, interviews, and other purposes. It enables developers to add various attributes such as real-time communication feature to cloud computing to ensure communication consumers without the need for back-end interfaces. Video communication PaaS is gaining popularity in various sectors such as business, media, education, and healthcare.

Top PaaS Companies

Amazon Web Services Inc.

Google LLC

Microsoft Corp.

Oracle Corp. Inc.

PaaS Examples

Some of the most popular PaaS examples: AWS Elastic Beanstalk, Heroku, Windows Azure (mostly used as PaaS),, OpenShift, Apache Stratos, Magento Commerce Cloud.

What is IaaS

IaaS, known as Infrastructure as a Service. It is a cloud-based infrastructure resource service that are provided to enterprises or organizations through virtualization technology, so that that enterprises or organizations can build and manage their own servers, network, operating systems, and data storage and so on. Unlike SaaS and Paas, IaaS is on-premise infrastructure services. Although it gives users higher ownability and control to their cloud applications, it normally requires a significant initial investment in physical hardware, and a dedicated IT team to maintain the hardware and keep everything up to date.

Global Infrastructure as a Service (IaaS) Market Overview

Technavio reports that the global IaaS market size will grow by USD 101.56 billion from 2019 to 2023, expecting to maintain a strong CAGR of over 28% during the forecast period. Organizations are embracing the infrastructure as a service model to solve the challenges related to data management and security – for instance, restricting public cloud adoption among government agencies. The increased IaaS adoption across industries is one of the major factors driving the Infrastructure as a Service market growth over the forecast period.

The simplification of disaster recovery with the cloud is one of the crucial Infrastructure as a Service market trends influencing growth. Cloud can simplify disaster recovery management with regular backups. Cloud storage is also more affordable when compared to on-premise storage. This has enabled IaaS providers to offer flexible pricing models. Vendors in the IaaS market are developing strategies and forming alliances to provide enhanced services to customers and better disaster recovery systems.

Top IaaS Companies

Alibaba Cloud

Amazon Web Services Inc.

Google LLC

IBM Corp.

Microsoft Corp.

IaaS Examples

Some of the most popular IaaS examples: Amazon Web Services (AWS), Microsoft Azure, DigitalOcean, Linode, Rackspace, Cisco Metapod, Google Compute Engine (GCE).


Market reports featured in this article: