Defining Types of Cloud Computing without “IT-Speak”

Cloud computing has come of age, breaking through its “self-centered teenage years” and becoming a “must-have technology for every enterprise.” (Forrester, Predictions 2019: Cloud Computing).

While cloud leaders, such as Alibaba, Amazon Web Services and Google are predicted to grow even more in 2019, the global cloud computing market will follow suit, expanding by more than 20 percent, the report projects.

But what does this really mean? More applications to lease? It can be tough to imagine we need more applications than we already have, so will there be less new development and more acquisition and maturation of the market? What does this mean for SMB leaders?

In the following, we will break down the global trend to answer these questions for you.

Defining Cloud Computing in General

The cloud refers to centralized IT resources, which can be accessed via the Internet. When you download an app on your mobile device, you might have noticed that the app itself requires very little data. This is because the majority of computing goes on “in the cloud,” that is, in a data center, not on your phone.

Software as a Service (SaaS)

SaaS is a cloud-driven distribution model for software, whereby third-party providers deliver and host applications in the cloud so your business does not have to purchase, install and run the software on your workstations. This is radically different than how IT was organized in the early 2000s, when everyone had to purchase a copy of Microsoft Office, upfront, and install it on every workstation. Now, most businesses lease Office 365 as SaaS, which allows users to work on their documents in the cloud, accessible from any device, anywhere with an Internet connection.  

SaaS is one of four main categories of cloud computing, the others being Infrastructure as a Service (IaaS), Business Process as a Service (BPaaS) and Platform as a Service (PaaS).

Infrastructure as a Service (IaaS)

This form of cloud computing is when a third-party provider delivers virtualized computing resources over the Internet to customers. This can include servers, network equipment and software. It’s like SaaS, except you install and manage your own applications like you would on your own desktop.  

Businesses often install and run their own software in these virtual environments. They rent IaaS and pay for only what they use. This arrangement can be ideal for certain applications that require significant IT resources infrequently.

Platform as a Service / Cloud Application Services (PaaS)

This cloud computing model is one in which a third-party provider delivers operating tools to customers over the Internet used to develop, run and deploy applications. If SaaS is the retailer, then PaaS is the supplier. If you want to develop and distribute a proprietary application, then you might lease PaaS.

PaaS is a significant driver behind the proliferation of applications in recent years because it allows businesses with fewer resources to deploy applications without paying for the IT resources upfront.

PaaS and IaaS are the two fastest growing cloud deployments, doubling every three years as more and more businesses master them.

Business Process as a Service (BPaaS)

Historically, when a company wanted to automate its business process, it needed to build those processes into a custom-made application. Business process outsourcing companies would implement the desired processes. But increasingly, large companies are looking at process and programs as more fluid. Instead of a packaged application that has everything you need (and probably has a lot of things you don’t, and lacks a bunch of things you would like), it’s possible to select a business process application. There are a few advantages of this model, firstly that, the same process can be applied to multiple application environments. You could even link the process to other cloud services, such as SaaS applications your employees or customers might use.

  • BPaaS incorporates and employs the three other foundational cloud services to execute business process
  • BPaaS must be scalable, not only in the sense of handling more customers and employees but also to support multiple deployment environments to satisfy the organization’s emerging requirements

BPaaS is by its nature a custom development and is not yet popular among SMBs. This explains why BPaaS is growing the slowest of all cloud offerings. However, contrary to Gartner’s projections, we believe BPaaS might pick up the pace slightly as containers, kubernetes (K8s) and event-driven computing penetrate the market.  These emerging technologies are reducing the price point of BPaaS quickly.

Read our next feature article to learn more.