Cloud Vs SaaS: What’s the Difference?

Cloud and Software as a Service are terms that you will see often. You’ll often see descriptions such as cloud-based, hosted SaaS, IaaS or PaaS when comparing different technologies to run your business.

These terms are important because they affect the way you interact with technology every day.

What do these terms really mean?

What is Cloud Computing?

Although cloud computing is sometimes referred to as cloud-based or cloud-based, SaaS (Software as a Service), and cloud computing are very similar terms. We will explain this in greater detail later. We’ll first define each.

Cloud-based software has become a mainstream technology. It is now mainstream technology and people use it every day, whether they know it or not.

Cloud-based business software includes organizational software such as Trello or Slack, to ERPs like NetSuite, and email providers such as Mailchimp. For familiar software names, see the Top 100 Cloud List.

Gartner predicted that the worldwide end-user spending for public cloud services would grow 18.4% to $304.9 billion by 2021, up from $257.5 million in 2020.

What is the cloud? You can think of the cloud as the internet.

Cloud-based software allows you to access it from anywhere and anytime via the internet (the “cloud”) All you need is an internet connection and the ability of logging into the system using a web browser. You can use a phone, a computer or a desktop computer. You can be anywhere you want, including at home, the office, and at the airport. You don’t have to be anywhere, just as long as there is WiFi.

Cloud computing, in technical terms, refers to the instant availability of computer resources such as storage, servers, networks, and databases. Cloud computing makes data centers accessible to all users via the internet.

Cloud Computing vs Traditional IT

Cloud computing was not possible before companies had their own servers or hardware to run software applications. To use the software, you would need to physically insert a CD onto your computer.

Maintaining your own hardware can prove costly and time-consuming. It can also limit the number of people who use the software, since it must be installed locally.

Cloud computing is an IT game-changer. Cloud computing is a game changer for IT teams. They no longer need to own and manage their own software and hardware assets. They don’t require deep technical expertise to setup, manage, and secure their resources.

Instead, they partner with a cloud service provider or third-party that hosts your software on remote servers. They store and process your data. These servers are located in data centers around the globe. Cloud computing is a cost-saving option for IT services because it allows multiple companies to share their computer systems. Teams can also access their cloud services from anywhere on the internet.

Gartner said that the shift to cloud in IT spending will accelerate following the COVID-19 crises. Cloud is expected to account for 14.2% of global enterprise IT spending in 2024, up 9.1% from 2020.

Cloud computing is transforming every industry. It reduces IT costs and supports remote workers. It also allows for mobility and collaboration between team members.

Cloud Software Benefits and Examples

Cloud computing has many advantages. Cloud computing is not a hassle. You don’t need to manage, maintain, update, or worry about the security of your software applications’ data. Your data is available in real time, whenever you require it. You only pay for space on the hosted servers, and can scale your resources as needed.

Cloud computing means that you are responsible for maintaining any applications that you run on third-party servers (i.e. Amazon AWS servers. Third-party manages the physical servers as well as the operating system.

Microsoft offers a detailed explanation of cloud computing.

So where does SaaS fit in with cloud computing?

What is Software as a Service (SaaS), and How Can It Help You?

Software as a service is a delivery model that licenses a cloud-based software program to a user. Access to the application is via the internet. This means that the user does not need to install or maintain the software locally.

The application runs on the SaaS provider’s servers. They are responsible for its security, performance, maintenance, and security.

SaaS applications typically are licensed on a monthly basis. A monthly fee is charged based on the level of service you receive and how many users are required. As a service, SaaS providers deliver and maintain their applications to you via the internet.

SaaS Benefits and Examples

SaaS software offers many benefits. It’s similar to cloud computing and offers instant access to software at a fraction of the cost. Multiple users can have the same software. You don’t even have to worry about the server maintenance as a user.

There are also terms like IaaS or PaaS that can be used to refer to Infrastructure as a service and Platform as a service, respectively. Both terms refer to cloud computing but have different capabilities as services.

SaaS can be thought of as a part or branch of cloud computing. It is a license that allows you to access a particular software application via the internet.

Cloud vs SaaS

It is clear that SaaS and cloud computing are both closely related but have different terms.

Cloud computing allows users to modify and manage any software applications on servers that are hosted remotely by third-party companies like AWS. These servers are accessible via the internet and you have access to all your data.

SaaS allows you to pay a monthly subscription to use a cloud-based, already-developed software application over the internet. The software is not your responsibility. SaaS software has one drawback: you may lose some control over how the software is managed and customized.

nChannel is a great example of both a SaaS and cloud computing application. nChannel is a cloud-based integration tool that connects retail systems such as ERP, eCommerce and POS systems. It allows merchants to share data, including orders, inventory and tracking/shipping information.

SaaS is how we deliver cloud applications to our customers.

We developed and own the nChannel app and provide customers with access via the internet. nChannel manages, secures and processes data from customers that are kept on remote servers in “cloud.” We do not own the servers. They only maintain the application that runs on them.

Our customers pay a monthly fee to access cloud-based software. It can be used by multiple users and accessed via the internet.

Cloud computing and SaaS can be combined to provide easy-to-access, affordable software solutions to all users.