To say that the term ‘SaaS and Cloud’ are most misleading in today’s context is not an exaggeration. Gartner was placing SaaS and Cloud computing separately in hype cycle just a couple of years back and has now decided to combine them under cloud computing. I can think of many reasons including some radically polarized thoughts but then I have lesser influence, if I have one! In fact, ReadWriteCloud Channel places cloud computing as the top worst term in the world of cloud while its poll indicates Cloud in a box, Cloudstorming and (Fill in the blank) as a service being the top contenders. I think it is time analysts put an end to coining more terms in the world of cloud and make it simpler.
Are SaaS and Cloud really different? I think yes. Reasons are plenty but a few are more prominent than others, like the target audience. While SaaS audience is more and more about people who are using an internet application, cloud computing is about the technical elements such as hardware, software and services that are required to support the application, thus targeting software vendors (ISVs) rather than users. Competition for SaaS comes from on-premise softwares which is not the case for cloud computing. Though both works on the similar principles of buying vs. leasing, SaaS is more about application and functionality while cloud computing is more about technology, services and infrastructure. To summarize, I think we can safely say that SaaS is “on demand software” while cloud computing is “on demand services”.
So, why is the confusion? I think it has more to do with marketing than anything else. Cloud as a term has become all encapsulating term for anything on-demand, outside the firewall! You wanted on-demand storage, on demand computing, on demand CRM, it is all Cloud. Make life easier for marketers, isn’t it?
Do SaaS and Cloud compete with each other? No, they don’t! They complement each other and they will co-exist for a long time. The terminology may differ, the keywords may be redefined but the difference will still be there. Some skeptics may say that SaaS is one of the offerings in Cloud and though I may agree with it, it still makes it different.
I may be an outlier, but in my opinion, cloud computing is just one of the ways to deliver SaaS!