iaas-business-model

IaaS Business Model

IaaS stands for infrastructure as a service. Together with other “as-a-service” models, the basic premise of this model is to offer a solution to the final customer without having to host it on-premise, with complex implementations and large overhead. The IaaS model provides virtualization, storage, network, and servers where the final user/customer will handle applications, data, operating systems, and run times.

Breaking down the IaaS business model

IaaS vs PaaS vs SaaS
Source: Red Hat, What Is IaaS?
Above the core difference between IaaS, on-side, PaaS and SaaS.
Infrastructure as a Service — IaaS includes servers and storage, networking firewalls and security, and datacenter (physical plant/building). PaaS includes IaaS elements plus operating systems, development tools, database management, and business analytics. SaaS includes PaaS elements plus hosted apps.
Source: Microsoft Azure, What Is IaaS?
The different layers of companies built on top of the various “as-a-service” model. From IaaS which is the the bottom, to PaaS and SaaS.
c3.ai-iaas-paas-saas
Example of a SaaS model built on top of IaaS and PaaS (Source: C3.ai)

Where in an on-premise solution the company will have to control, manage and implement the full stack:

  • Applications.
  • Data.
  • Runtime.
  • Middleware.
  • O/S.
  • Virtualizations.
  • Servers.
  • Storage.
  • Networking.

In IaaS the company/customer will have to worry only about:

  • Applications.
  • Data.
  • Runtime.
  • Middleware.
  • O/S.

Where the IaaS provider will take care only of:

  • Virtualizations.
  • Servers.
  • Storage.
  • Networking.

Why do companies leverage on IaaS?

Usually, businesses leverage IaaS for testing and faster deployment, hosting, web apps development and more. And some of the benefits for using IaaS is the need for companies to reduce the capital expenditure coming with setting up a complex platform on premise, before seeing its benefits, in the first place.

Therefore, this might help companies to innovate faster, and with lower expenses, more security, scalability, faster deployments, expanded use cases across the organization.

Of course, IaaS also comes with less control. In a market skewed toward rapid innovation, more and more companies, also at the enterprise level are leveraging on that.

Read More:

Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which reached over a million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get The FourWeekMBA Flagship Book "100+ Business Models"