The Costs of IaaS and SaaS

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It’s time to determine the cost of IaaS and SaaS, and discover how you can save on cloud spending for your organisation.

Cloud computing has become the new norm these days. As cloud services are becoming more affordable, trustworthy and robust, we see how more and more businesses are now in the process of migrating their applications and workloads to the cloud.

Most companies choose the public cloud, where computing services are made available through third-party providers. The two most popular models are IaaS and SaaS, which can both provide a myriad of benefits to your organisation.


IaaS, which is short for Infrastructure as a Service, provides services used for monitoring and accessing storage, computers and networking. Users don’t have to purchase resources outright as these as available on-demand for a small fee. Popular IaaS providers are Microsoft Azure and AWS.

On the other hand, you find Software as a Service (SaaS), which is one of the most popular cloud options for businesses today. Essentially, the SaaS system works with third-party vendors in delivering cloud applications to businesses. No installation or downloading is required, as all the data and applications are stored and managed in the cloud. Popular SaaS products include Office 365 and Dropbox, to mention only a few.


Benefits of IaaS and SaaS

Let’s take a quick look at some of the most important benefits your business can get from cloud infrastructure services and cloud application services.

IaaS benefits

Many businesses prefer the IaaS model simply because they don’t have the inhouse resources to manage hardware. Naturally, it’s therefore considered a favourite amongst start-ups and SMEs. But what are the general benefits of IaaS?

  • IaaS software is easy to set up. You don’t have to worry about installing the system, rather you can allocate your precious time to more pressing matters (such as running your business).
  • It can reduce your costs as you no longer need to purchase hardware or set up a physical server infrastructure.
  • IaaS can provide better security for your sensitive files and data.
  • It’s highly scalable, meaning that you can scale resources according to what your business requires.
  • Enterprise IaaS has a Pay-As-You-Go structure for billing users, so the cost will be significantly lower than with other services. In other words, you only pay for what you use.

SaaS Benefits

SaaS is often recommended for small and medium sized companies with limited IT resources inhouse.

  • As your data is located in the cloud, you can access your applications anytime, anywhere.
  • SaaS makes it easy for businesses to incorporate new solutions without having to resort to a long and tedious process. This means there will be no disruption to your day-to-day processes.
  • Instant scalability. Your SaaS subscriptions are easily upgradeable, meaning that your applications can be scaled whenever you need it to.
  • All updates are automatic and are handled by your SaaS provider.
  • As with IaaS, SaaS doesn’t require installation, upgrading or management. This will save you both time and money.

Minimising the cost of IaaS and SaaS

Although the public cloud, and particularly IaaS and SaaS, is almost guaranteed to provide you with return on investment, it’s still essential to learn how to determine cloud costs.

Gartner predicts that 2019 global spending for public services and infrastructure is expected to go as high as $210 billion. By 2022, this is predicted to reach $370 billion. Following this, many companies are no looking to start the cost management process. In the report 2019 State of the Cloud, 64% of the respondents placed cost savings by optimizing the way they use the cloud as their top priority. Naturally, this number is expected to continuously increase as the number of cloud management platforms also rises.

As such, businesses are now looking for strategies that can enable them to reduce cloud costs.

The first thing on your agenda should be the constant monitoring of all your cloud movements. Businesses that use the public cloud should make it a point to regularly track, manage, and understand all deployments and what their purpose is – as well as how they are used and who uses them.

In addition, we recommend that you look into these things to effectively manage your cloud costs.

  • Check your provider’s billing model.

This should be one of your first steps. Ask yourself the following questions: What does your applications need in terms of CPU, storage, and memory? Which cloud instances should you choose for these requirements? Learning how your infrastructure is billed can help pinpoint the areas that need the most cost management.

Once your applications are live, find a way to come up with an estimated amount of their cost. Compare your estimates with current costs, particularly those of on-premise costs, as this will help you set up a possible range that you can use as a gauge for your cloud billing.

  • Understand your cloud applications.

Always make time to study your applications and their impact on your business process. We recommend that you take special note of their requirements, characteristics, and patterns of usage. By doing this thoroughly, your business will be prepared for whatever unexpected developments may happen.

  • Determine areas where additional spending might be needed.

This is especially important if you plan to deploy multiple cloud providers. We also recommend that you regularly check and verify your cloud billing. How much are you paying for CPU? How much are you paying for storage and access? Can this amount be reduced – or should the investment actually be increased?

  • Choose the right cloud vendor.

This step is often, and unfortunately, overlooked. However, you must remember that all cloud providers are different and that they can all impact your business in different ways.

Naturally, the vendor you choose will have a direct impact on your cloud costs, so it’s essential to compare all the cloud vendors you’re considering. Check out what all of them has to offer – and how these offerings can be compared to your exact requirements. As much as possible, and this cannot be stressed enough, you should try to avoid vendor lock-in. This can cause difficulties if you later decide to migrate your applications from one cloud provider to another.

  • Pay close attention to major areas in order to cut cloud costs:

Make your that your team can see how they are using the clod infrastructure and what they are spending. It’s difficult to navigate well when you’re “blind”. In addition, you should consider identifying your various resources and keep track of who uses what. If you know who is responsible for what, it will be easier for you to track and record your spending.

Set a practical budget for each account. However, only do this after you have identified your resources and identified cost estimates. With a strict budget in place, it will be easier to keep reckless spending at bay and to determine which of your resources are the most needed.

Regularly monitor and manage your storage. If there are volumes that are of little value, do away with them. On a similar note: when there is no workload – on weekends or at night, for example – you can save on costs by shutting down all environments.

Finally, choose a reliable and efficient cloud provider. Don’t choose a brand just because they’re the biggest on the market – rather, do your research and ensure that your provider can meet all your requirements.