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Cloud Computing Service Models: Which One Is Best for Your Business?

Over the last five years, we’ve seen a drastic increase in applications run through the cloud. On-premise environments are on their way out; these days, companies understand that cloud computing offers the best blend of functionality, efficiency, and scalability.

And the data seems to agree. Managed cloud services for businesses have increased substantially over the years, with the total value of the cloud computing market projected to reach $760 billion by 2027.

But just as it is with on-premise architecture, there are several different platforms available to cloud users: SaaS, PaaS, and IaaS, to name a few. There are also different ways to structure the cloud computing services environment across public, private, and hybrid cloud servers.

And as we’ll review, the way you design these environments can make a world of difference in the benefits you’ll receive from your cloud investment.

SaaS, PaaS, IaaS: Cloud Computing Service Models

It was estimated that 68% of businesses would make use of managed cloud infrastructure services by 2020. And when we look at the current state of cloud networks, servers, and architecture options available to businesses, it’s easy to see why the strategy is catching on.

  • 87% of companies experience business acceleration through cloud services
  • 47% report that IT costs would drop 30-50% by using cloud infrastructure and apps
  • 73% find improved security through the hosted cloud environment

While cloud computing may not be suitable for every business, the IT infrastructure outsourcing market is growing every year. As of now, there are several primary cloud platforms worth reviewing as you consider your options:

  • Software-as-a-Service (SaaS): A standard cloud computing model where vendors provide access to cloud-based software, with applications and services accessed via API or through a web browser. SaaS is designed to provide on-demand computing resources to companies, usually brought on to boost a business’s infrastructure, software capabilities, or security. Industries of all kinds leverage SaaS these days, though some of the most common uses include web hosting (through solutions like Amazon Web Services), customer service management (think Zendesk), and accounting functions (such as QuickBooks Online or Xero).
  • Platform-as-a-Service (PaaS): Users access a cloud environment sandbox where they can develop, test, and deploy applications – often coming bundled with pre-built software development tools and other managed functions like security and backups. Common PaaS applications include API development, business process management, and analytics assessment. Microsoft Azure, AWS, and Google App Engine are a few of the biggest names in PaaS, offering their development tools to the finance industry, marketing, web development, and more.
  • Infrastructure-as-a-Service (IaaS): Vendors provide services like network access or storage alongside other computing resources. Customers use their own platforms for installing applications and services within the rented infrastructure. IaaS is usually provided by big-name industry players who have the computing resources to manage it, including Amazon, Google, Microsoft, and IBM. Given its scope, IaaS is most suitable for industries that need support with big data analysis, networking services, or application testing and deployment.

IT organizations should evaluate their computing needs before every budget cycle to ensure they’re getting the most out of their virtual computing environments. There are many ways to deploy these cloud service models, and your needs may change over time.

Public, Private, and Hybrid Cloud Environments

The above models describe how you can leverage various services and operating systems through the cloud, but what about the cloud environment itself? Below, we’ll detail a high-level breakdown that shows the benefits of managed IT services and the drawbacks of each strategy to help shine some light on these technical issues.

Public Cloud

Public clouds involve infrastructure that is publicly available and often extensive in nature. Think Amazon Web Services (AWS), Microsoft Azure, or Google Cloud Platform. All three of the above cloud computing service models can be deployed in the public cloud environment.

 The advantages of public clouds include the following:

  • Data center and information redundancy between zones for information security
  • A straightforward framework that makes costs transparent
  • Real-time scalability as your business grows

It’s a simple, cost-effective approach based on low up-front expenses and a pay-as-you-go framework. Of course, it comes with a few drawbacks as well. Cloud environments rely on third-party server maintenance, which can create problems when unexpected server issues or delays pop up. It also comes with ongoing operational costs each month, depending on your purchased services.

Some companies also find that public clouds offer less visibility into processes, and most come with limitations on which configurations you can apply to make the service your own.

Private Cloud

Private clouds function similarly to public clouds, except that their technology stack runs on on-premise or co-located hardware. This hardware is typically managed by either the client or an IT service provider in the co-location. A few examples of private cloud service models are Helion Cloud Suite, VMware, and Datto. And like public clouds, IaaS, PaaS, and SaaS applications can be hosted on private cloud service models

The advantages of private clouds generally relate to ownership and control:

  • Private cloud hardware and software is independently owned, meaning that users typically have more control over its setup and configuration
  • High levels of scalability, ideal for growing businesses

The main drawback here is cost. Private clouds come with higher upfront expenses than their public counterparts, and they typically feature higher ongoing maintenance costs as well. There are other cost issues to consider as well, including the need to purchase and maintain your own hardware.

Hybrid Cloud

When neither a public nor a private cloud model can do the job, we have a middle ground in hybrid clouds. In the hybrid framework, some infrastructure exists on-premises in servers you control, with the rest of it living in a public or private cloud environment. And like the others, various PaaS, IaaS, and SaaS services can be hosted on hybrid clouds. This ‘best of both worlds’ set of benefits for companies, includes:

  • Low upfront costs backed by a pay-as-you-go model
  • Cost-effective and real-time application scaling
  • Cloud resource planning flexibility, with options to strategically balance loads across onsite and cloud servers

There are two main drawbacks of the hybrid cloud model. It’s more complicated to set up than either of the above cloud options, and they tend to be less scalable over time. Generally, hybrid clouds are considered a stepping stone to a public cloud from a traditional, on-premise hosting environment.

Learn more about the benefits of cloud computing and our service offerings suited to small and medium businesses. Speak with one of our skilled IT strategists today to see how these services can boost your company’s efficiency.

Get Started With Managed Cloud Services

The cloud can bring significant benefits to businesses, but it’s important that you deploy these services correctly. And the above frameworks are just the tip of the iceberg. 

There are other cloud computing service models you can implement for better IT strategic planning, including Hardware-as-a-Service (HaaS), Functions-as-a-Service (FaaS), and more. Each service delivery model brings a different set of benefits for your business.

Businesses of all kinds consider cloud computing a viable option these days, but it’s important that you have all the information you need to make an informed decision before following through. If you need help understanding or planning any aspect of your cloud computing environment, we’re here to help.

Fusion Computing has done hundreds of Cloud Computing implementations for organizations ranging from 10 seats to well over a thousand.


Please contact us for more information.