Is There A Difference Between SaaS and Cloud Computing?

When we talk about cloud computing, do we mean it same as SaaS? Well, almost every time. SaaS is the most predominant type of cloud computing and people use the term interchangeably with cloud computing which is the latest buzz word. There isn’t a doubt that Cloud Computing is the next big thing in the computing world after Mainframe, Client Server Computing and Virtualization. These have been the predecessors and are responsible for making Cloud Computing possible.

On the face of it, SaaS and Cloud Computing are very similar. They take away the complex process of installations, deployment and maintenance. SaaS and Cloud Computing contribute significantly towards saving costs – in some cases they save cost up to 80% just on electricity! Cloud Computing and SaaS are available on subscription basis and are charged at pay-per-use basis They provide services almost instantly and get you up and running quickly. Both SaaS and Cloud Computing are globally accessible as these services are provided on the internet.

SaaS has been around since the late nineties and went into oblivion during the dot com bust, only to come back with more pervasive appeal. Many software tools started switching to the SaaS model, though it took some years for SaaS to come into mainstream.

SaaS was the first big step towards the Cloud Computing and the cloud is its home. It sits in the cloud; it means that the SaaS needs the fundamentals of the Cloud Computing to exist but Cloud Computing is a bigger canvass. Cloud Computing also includes providing Platform-as-a-service (PaaS) and Infrastructure-as-a-service (IaaS).

The penetration of broadband internet services to a critical level has been the cause for progress of Cloud Computing. It is now feasible and has become a ‘rebranded’ term for SaaS which was the rudimentary prototype for the more encompassing cloud computing marvel.

According to Gartner, the analyst company, cloud computing is a way of computing which provides dynamically elastic and massively scalable IT services by using internet technologies. Similarly SaaS is also extremely scalable even with multi-tenancy providing one-to-many mapping structure.

SaaS and Cloud Computing overlap as discussed above. But there are certain differences between them. These differences should be understood in order to take sound judgement around choosing SaaS or Cloud Computing services.

Personality difference: Subset of A Larger Concept

SaaS ensues when an application is provided as a utility on-demand, whereas Cloud Computing happens when all computing is provided as a utility on-demand. SaaS essentially is the part of Cloud Computing.

Functional Difference: Data Storage & Ownership

The critical difference between the two lies in functional characteristics of data ownership and storage.

With SaaS you do not own the data. That is the biggest challenge. You subscribe for a SaaS and the data resides in the servers of the service provider. You lose control over data and unless agreed upon in SLAs, the service provider actually can use your data in the way which he wants to, though this may not be true with every SaaS vendor. With SaaS data ownership and security definitely are big concerns, but those risks are not grave enough to outweigh the benefits of SaaS, especially for startups and SMEs. Read our earlier post ‘Why ALM softwares with SaaS model are good for Startups?’ in this regard.

Google docs, Gmail, Yahoo mail etc. are all examples of SaaS. They are available as free services but the entire data resides in the servers of the service providers and the users do not have much control on that data. Security is always a matter of concern.

In case of Cloud Computing, you have the control over the servers where your data and software applications sit. The software here can be called as cloud software. The only difference is that these robust and highly scalable servers are not physically present at your site like your other servers. The entire cloud computing infrastructure allows you to take back-ups, make data repositories and store data in the cloud. In this case you have complete control over the data storage and cloud computing gives you freedom to move your data off the cloud too, should you need to anytime in the future.

Figure 1 : Cloud Computing Explained