IaaS, PaaS, SaaS, BPaaS: Do you speak cloud?

Everyone is familiar with the Cloud. But did you know that there are four broad categories of available services, namely IaaS, PaaS, SaaS and BPaaS?

Infrastructure as a Service (or “IaaS”) is the lowest level of service that is found in the Cloud. The service provider hosts a virtual infrastructure, which is composed of a storage space, servers and network elements (e.g. firewalls, load balancers). Customers can thus configure the infrastructure (e.g. memory, storage space, CPU) and use it as they see fit, according to the pricing models that are in effect, which can consist of either a fixed-price model or a price determined according to the volume used. The most known IaaS providers available include Amazon EC2, Windows Azure, Rackspace and Google Compute Engine.

Platform as a Service (or “PaaS”) adds an additional layer to IaaS by proposing, in additing to the physical layer, an operating system, an operating environment, a database and software servers that customers can manage and configure as they wish (for instance, as regards security, user accounts and software parameters). The most well known PaaS providers include AWS Elastic Beanstalk (Amazon), Windows Azure, Heroku, Force.com, Google App Engine and Apache Stratos.

Software as a Service (or “SaaS”) is added above PaaS and offers access to an application. This type of model is frequently referred to as “on-demand software”. Customers no longer have to worry about installing, hosting or maintaining the application, as it is the service provider who takes care of this. The pricing is frequently determined according to a fixed-price model or according to the volume of the service that is used, calculated through various metrics (e.g. number of users, level of service). Most types of application now exist under this form: ERPs (e.g. JD Edwards, SAP HANA); CRMs (e.g. Salesforce); middleware (e.g. Talend); and office tools such as Google Apps or Microsoft Office 365. Some providers even offer integrated solutions that include both an ERP and a CRM, such as Microsoft Dynamics 365.

Lastly, Business Process as a Service (or “BPaaS”) extends beyond SaaS and the scope of a sole application by handling business processes that are frequently cross-functional, such as payroll management. BPaaS thus allows for the coordination of the automatic (services) or partly manual activities of a process, which are spread out across several applications that are hosted in the Cloud or on the organization’s infrastructure. Customers can thus map their processes (BPO) as well as the activities that compose them on the different applications. The pricing is calculated according to the use of the service. Providers of BPaaS include IBM, Wipro, Ovum and Cognizant.

These different types of services stand in contrast to on-premises software, which refers to software that is hosted on the internal infrastructure of the organization, a solution that many organizations presently use. Businesses that choose on-premises solutions are thus responsible for hosting and ensuring the maintenance of their servers and of their network, in addition to resolving technical bugs that arise with each version upgrade. To do so often requires significant involvement from the IT team that is thus precluded from engaging in other activities that would add value to the business.

According to Gartner, businesses will over the next five years make over one billion dollars of direct and indirect investment to transition to cloud computing. Roughly 43% of this investment will be spent on BPaaS, with 37% being directed to SaaS, 10% to PaaS and 17% to IaaS.

According to a study conducted by NOVIPRO and Léger on IT trends within small and mid-size enterprises, 54% of IT managers in Canada agree that the future is in Cloud computing, and 52% of these respondents, 52% envision adopting Cloud computing in the next two years.

And what do you plan to do as part of this movement?