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American Focus > Blog > Tech and Science > Decoding the Jargon for Decision Makers
Tech and Science

Decoding the Jargon for Decision Makers

Last updated: July 30, 2025 8:00 am
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Cloud computing and Software as a Service (SaaS) are often misunderstood as interchangeable terms, but they are distinct concepts. While SaaS falls under cloud computing, cloud is a broader infrastructure and service delivery model that includes Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and SaaS. This article will compare cloud vs SaaS on various parameters to showcase the differences between the two, explain what SaaS software is, how it differs from cloud, and when to choose one over the other based on specific needs.

Cloud computing refers to the delivery of computing resources, such as networking, storage, databases, software, and infrastructure, as services over the internet. It eliminates the need for businesses and individuals to own and manage physical resources, allowing them to access services on demand from cloud providers like Amazon Web Services, Microsoft Azure, and Google Cloud Platform. Cloud computing is a metaphor for delivering computing resources over the internet without users needing to understand the technical details behind it.

On the other hand, cloud-based software, also known as cloud software, is software that is hosted, delivered, accessed, and used over the internet rather than being installed and run on a local computer or server. Users can subscribe to a service hosted by a third-party provider and access it through a web browser or application without having to purchase or manage software and infrastructure themselves. Public cloud, private cloud, and hybrid cloud are the three types of cloud computing deployment models that offer different levels of control, customization, and security.

There are three main types of cloud computing services: Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). IaaS provides on-demand access to IT infrastructure services, while PaaS offers tools to develop and deploy software solutions. SaaS delivers complete software applications as a service, with both the infrastructure and service managed by the provider.

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Software as a Service (SaaS) is a cloud-based software delivery model in which a provider hosts software, and users pay to access and use it over the internet. SaaS applications are ready-to-use solutions accessed through a web browser or mobile app without the need for installation or complex setup. SaaS makes it easy for users to connect to powerful applications from any internet-enabled device and pay for the service they need on a subscription basis.

SaaS applications are hosted and managed by a third-party provider, allowing users to subscribe and access the latest version, updates, and support without the hassle of maintaining servers and infrastructure. Some popular SaaS applications include Slack, Salesforce, Zoom, and Shopify, which offer features like scalability, automatic updates, and cost-effective pricing.

SaaS is inherently dependent on cloud computing, as the cloud provides the infrastructure and resources needed for SaaS applications to function and be delivered to users over the internet. The cloud enables scalability, accessibility, security, and maintenance for SaaS services to operate seamlessly.

In conclusion, while cloud computing provides a broader infrastructure and service delivery model, SaaS is a specific software distribution model within the cloud. Businesses can benefit from both cloud and SaaS solutions, depending on their specific needs, resources, and strategic goals. Cloud computing is ideal for custom software development, scalable infrastructure, and hosting large applications, while SaaS is suitable for fast deployment, cost-effective solutions, and limited IT involvement. By understanding the differences between cloud and SaaS and their respective advantages, businesses can make informed decisions on which solution best meets their requirements.

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