This post was last updated August 27, 2025.

Key Takeaways

• Cloud computing takes the burden of costly infrastructure management off of businesses and offloads it to a third party vendor.

• Cloud service models offer major benefits like only paying according to usage, easy scaling, data protection, and increased security, but it’s important to choose the right vendor to avoid potential drawbacks.

• SaaS, PaaS, and IaaS are the three most popular cloud services models, each with their own advantages. SaaS allows you to hand over the most management tasks and responsibilities to a vendor, while IaaS gives you the greatest control and flexibility over your digital solutions.

• If your industry still needs a private cloud environment or self-hosted model for your digital solutions, consider Liferay DXP as one of the few leading vendors with that option.
• Compliance, reliability, and data security are three critical criteria when researching the right cloud provider.

Navigating Cloud Service Models

SaaS. PaaS. IaaS. Even if you already know what these “as a service” solutions stand for - even if you know that each one is a different cloud service model that requires an internet connection - can you explain the differences in detail and why all three exist in the first place?

Deciding the right cloud model for your organization to deploy applications in your tech stack can be critical for your success.

Before we go further, let’s talk about cloud computing in general first as a foundation for understanding cloud services and cloud providers.

What Is Cloud Computing?

As defined by Google Cloud, cloud computing is “the on-demand availability of computing resources (such as storage and infrastructure) as services over the internet.” Essentially, cloud computing, also called the public cloud, takes the burden of managing physical servers, physical hardware, and costly physical infrastructure off of businesses and gives that burden to a third party. By 2026, Gartner anticipates that public cloud spending will exceed 45% of total enterprise spending.

Self-managing your own infrastructure and resources is also called self-hosting, on-premise, or private cloud hosting. In many cases, organizations may integrate on-premise infrastructure with cloud solutions to create hybrid cloud architecture, or combine private clouds with public clouds for more flexibility, security, and compliance. We’ll talk more about certain situations where this might be the best choice for you a little later.

For most businesses and organizations, however, cloud computing is the way forward. Cloud adoption is now at 94% and is in general actually safer than self-hosting.

Using a company like Google Cloud, Amazon Web Services (AWS) or Microsoft Azure, with the cloud computing service model, your business shares resources, software, and information through the internet on-demand. You pay for a slice of the cloud resource pie—but this “slice” is typically much bigger and more cost effective than trying to buy and then manage the whole pie yourself.

Advantages of Cloud Computing

Sharing cloud resources via this model offers several advantages:

• Save on overbuilding and overprovisioning costs with pay-as-you-go pricing. This means you only pay for the resources you actually use, which is especially critical if your resource consumption is unpredictable or you experience peak and valley seasons of traffic. 

• Scale as necessary without the additional infrastructure expense. A cloud provider enables you to scale up or down as needed, so you won’t either overwhelm your systems or invest too much as a precaution.

• More effective collaboration from anywhere. With cloud storage, you and your team members can access data and solutions on any device in any location using the internet.

• Protection against data loss. Cloud computing providers have backups and disaster recovery strategies in case your systems experience malfunctions, attacks, or user errors.

• Shorten time to market. Pre-configured tools and managed services make go-to-market times much faster.

• Better security. As briefly mentioned, cloud computing can often be more secure than a self-hosted option. Reputable cloud providers typically have more extensive security features than you could afford on-premise and offer additional security expertise.

Interested in learning more about security for your digital solutions? Read 6 Best Practices to Strengthen Website Security.

Cautions Before Investing in Cloud Computing

Although migrating to a public cloud service model is by and large the best choice for most companies with a reliable internet connection, there are a few things you should keep in mind before jumping into an investment:

• Without the correct oversight or technical support, you run the risk of having unused resources or an inefficient setup. This can undermine the cost savings cloud service models usually offer, so make sure you’re working with a reputable vendor or service provider who can also offer technical guidance and manage your cloud environment effectively.

• Depending on the service model you choose, you still take on some security responsibility. PaaS and IaaS require you to share ownership of solution security with your vendor, although some vendors offer add-on subscriptions for increased security assistance.

• Compared to an on-premise solution, you may have less visibility and control over your cloud resources. The service provider usually owns, manages, and maintains the underlying infrastructure, so transparency from your provider is essential.

• The cloud migration itself can be complex, resource-intensive, and expensive if not planned properly.

All of these cautions have one thing in common: it’s critical that you explore the right vendor or service provider for your cloud migration who will give you the resources, transparency, and assurance you need to make sure you not only see ROI but also have a long-term solution in place.

Now that you have a little background on cloud computing and why it’s such an important service, let’s get into PaaS, SaaS, and IaaS.

SaaS, PaaS, and IaaS: The Most Popular Cloud Service Offerings

SaaS (Software as a Service), PaaS (Platform as a Service), and IaaS (Infrastructure as a Service) are the three dominant types of offerings and the most popular. All three have “as a Service” in common and require network access.

An “as a Service” cloud computing solution, again, enables business to offload significant IT resources to a vendor who will provide the cloud infrastructure, security, uptime, and scalability necessary to run a modern digital solution. You can access these solutions easily through the internet or online applications.

• SaaS (Software as a Service.) The SaaS model offers a full application stack, including infrastructure, maintenance, and software updates to the application itself. Currently, SaaS is the most widely used cloud computing service and the dominant software delivery model. SaaS technology has become seamlessly integrated with everyday life and transactions, as these solutions are often for the end user. 47% of venture capital funding in 2023 went to companies founded on a SaaS model.

• PaaS (Platform as a Service.) PaaS delivers the necessary hardware and software resources for cloud application development. Organizations can just concentrate on development without having to worry about infrastructure management or maintenance. The market for PaaS is also strong, recently valued at about $56M and estimated to grow 21.7% by 2030.

• IaaS (Infrastructure as a Service.) IaaS is the most similar to a traditional on-premise environment, but you receive on-demand access to IT scalable infrastructure services. Last year, the IaaS public cloud services market grew 22.5% and is expected to exceed $200B by 2027.

Next, we’ll take a closer look at each individual service model.

SaaS: An End-to-End, Scalable Solution

Software as a Service (SaaS) is the most comprehensive cloud computing service. The SaaS model delivers an entire SaaS application, managed by a SaaS provider, through a web browser. 

A SaaS provider hosts, maintains, secures, and updates the application, ensuring users have seamless access and ongoing support without worrying about the infrastructure or technical upkeep.

Additional Benefits

SaaS is incredibly scalable and easy to use. SaaS products provide several other distinct advantages such as:

• Predictable costs. Most SaaS products use subscription-based pricing.

• Hands-off maintenance and management. With the vendor taking care of so many tasks for you, your IT team can focus on the solution itself.

• Low barrier of entry. In general, SaaS products are easy to learn how to use and access, increasing adoption rates.

Examples and Use Cases

Major SaaS apps include ready to use software and technology you probably interact with all the time.

PaaS: For More Complex Requirements and Customization

The key difference between SaaS and PaaS is application maintenance. Platform as a Service (PaaS) solutions give organizations more control over the technology application itself, meaning more flexibility. Companies can build, test, deploy, run, update, and scale their own applications, but still without the slowdown of an internally managed platform. Some organizations using PaaS have saved up to 50% on operational costs.

For specific businesses and use cases, PaaS may represent the best of both worlds: the underlying cloud infrastructure is handled by the vendor while the organization still has customization flexibility. This is particularly helpful for projects that have highly complex requirements or components, which sometimes eliminates SaaS from the conversation.

Examples of PaaS Providers

Below you’ll find popular PaaS cloud providers.

IaaS: If You Want Maximum Flexibility While Still in the Public Cloud

Once called enterprise cloud, Infrastructure as a Service (IaaS) is the most hands-off of the three major options when it comes to vendor involvement. Organizations frequently rely on IaaS tools to manage their high-performance workloads.

With IaaS, although customers don’t have to maintain or update infrastructure, they are still responsible for the operating system middleware, potentially multiple virtual machines, and any apps or data. In practice, this makes IaaS more similar to an on-premise solution.

A sub-category of IaaS is CaaS, or Container as a Service. CaaS replaces VMs with containers as the main resource for building containerized apps.

Examples of IaaS Providers

Here are a few of the top IaaS providers.

Get the Picture: See Who Manages What for Each Hosting Model

Take a look: this image shows a broad overview of what you can expect from each way of hosting.

But What About Self-Hosting?

You may be in an industry with stringent regulations or additional requirements around the handling of sensitive data, like financial services, healthcare, or government. Organizations in these industries may opt for a self-hosted or private cloud option, or may not even have a choice depending on the nature of the solution implemented and its data. 

If this is your situation, you’ll need to invest in a development platform that supports your deployment requirements.

”For IT leaders, maintaining control over their technology stack is increasingly important. In a fast-changing world dominated by third-party services, having the option to self-host gives them predictable costs, full ownership of their data, complete control over security, and the flexibility to meet complex regulatory requirements without relying on a third-party vendor. For some organizations, particularly those in highly regulated industries or with specific data sovereignty needs, a self-hosted DXP isn't just a preference—it's a necessity." - Patrick van Blarcum, Sales Enablement Leader at Liferay

How to Choose the Right Cloud Service Model

Here’s the reality for your business: you may need a combination of service models depending on the specific technology you’re implementing. It’s very common for a business to use a hybrid cloud approach, leveraging SaaS for standard, less complicated use cases and PaaS or IaaS for custom solutions—and even, in some situations, specific self-hosted deployments.

To simplify things, we’ve created the chart below that only compares on-premise, PaaS, and SaaS and examines what features, control, and benefits each model offers according to your business needs.

Deciding on the Right Cloud Provider

If you’re convinced that SaaS, PaaS, or IaaS is the right move for your organization, you still need to pick the right vendor. As the market continues to grow, you have more options than ever.

Make sure you’re accounting for these three aspects when evaluating vendors:

1. Compliance. When researching any cloud computing provider, look into the industry standards, best practices, and regulatory requirements they follow. These include certifications like ISO/IEC 27001 and SOC 2 (Type 1 & 2) for general security, ISO/IEC 27017 and CSA STAR (Level 1 & 2) for cloud security, and ISO/IEC 27018 and HIPAA for data privacy. (HIPAA only applies to the healthcare industry.)

2. Reliability. Though obvious, you need to ensure the cloud vendor has proper disaster recovery practices and strategies in place so you can stay available during planned and unplanned downtime. Look for a vendor that has a competitive SLA.

3. Data security. Although PaaS and SaaS offer convenience and cost-savings, you also lose control of security. Investigate how cloud vendors navigate data management as well as any past data breaches. Be sure that any provider you consider has the protection, processes, and policies needed to guarantee the security of your data. 

Liferay DXP: A Flexible Approach to Cloud Computing Service Models

Liferay DXP is a Digital Experience Platform you can use to create limitless digital solutions, combining the functionality of a wide breadth of out-of-the-box tools into one platform so you can create captivating user journeys for customers, partners, employees, and suppliers.

With an enterprise subscription to Liferay DXP, you get to choose the cloud service model that makes the most sense for your organization: Liferay DXP has SaaS, PaaS, and self-hosted models. In fact, Liferay DXP is one of the few leading DXPs that still offers a self-hosted subscription option.

The Cloud Is the Present—and the Future

As Google Cloud notes, “Most companies today aren’t considering whether they should migrate to the cloud but what they should migrate.”

94% of companies are already using a cloud provider, and that number will only grow. When you’re evaluating how to implement your digital solutions and the cloud options you have, remember your decision will have major implications for your business’s financial, structural, and personnel resources.