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Is There A Difference Between Cloud Computing and SaaS?

I see SaaS as a subset or segment of the cloud computing market

Jeff Kaplan's Blog

Anyone who has been intimately involved in the evolution of the SaaS or cloud computing worlds has a right to be frustrated by the blurring of the lines between the two concepts.

In my case, I view cloud computing as a broad array of web-based services aimed at allowing users to obtain a wide range of functional capabilities on a 'pay-as-you-go' basis that previously required tremendous hardware/software investments and professional skills to acquire. Cloud computing is the realization of the earlier ideals of utility computing without the technical complexities or complicated deployment worries. With this precept in mind, I see SaaS as a subset or segment of the cloud computing market.

Unfortunately, opportunistic vendors, as well as uneducated journalists and overly simplistic industry analysts, are using the terms interchangeably to serve their own purposes.

While this might infuriate industry purists, the good news is that both ideas are gaining greater mainstream attention and acceptance as a result of escalating coverage in nearly every IT industry trade publication and even more importantly among the major business pubs like the Wall Street Journal, Forbes, Fortune and BusinessWeek, along with the NY Times.

I think this positive development far outweighs the potential confusion that could arise about the nuances between the two concepts. However, know it is incumbent on every cloud computing and SaaS vendor to clearly explain their offerings so they don't mislead potential customers.

The surge in demand for cloud computing and SaaS is partially due to macro-market factors, such as the recessionary economic climate and escalating pressures to fundamentally change traditional business practices. But, growing interest in cloud computing and SaaS is also the result of the success and satisfaction of the early adopters who are not only renewing and expanding their use of these web-based services, but recommending them to others, according to THINKstrategies' research and consulting experience.

The 'gold rush' stage we are entering in the cloud computing and SaaS movement will attract plenty of self-serving vendors, overnight experts and tabloid press who will attempt to exploit this exciting market opportunity. They will pose a new threat by offering inferior services, bad advice and distorted stories about the market realities.

For those of us who have been in the vanguard of the movement and worked hard to build a viable new industry, we won't defeat these forces by arguing over terminology. Instead, we will win long-term success by properly educating our customers and successfully satisfying their needs.


[This post appeared originally here and is republished in full with the kind permission of the author.]

More Stories By Jeff Kaplan

Jeff Kaplan is the Managing Director of THINKstrategies, www.thinkstrategies.com, the only strategic consulting firm focused entirely on the business implications of the transition of the technology industry from a product-centric to services-driven solution model, including Software-as-a-Service (SaaS), Cloud Computing and Managed Services. THINKstrategies helps IT/business decision-makers with their sourcing strategies; solution providers with their go-to-market strategies; and venture firms with their investment strategies. Kaplan is also the Founder of the Cloud Computing Showplace (www.cloudshowplace.com), the largest, vendor-independent, online directory and best practice resource center regarding SaaS, Platforms-as-a-Service (PaaS), and Infrastructure-as-a-Service (IaaS), including Managed Services. Kaplan is also the host of the Cloud Innovators Summit executive forum series, www.cloudsummits.com, including the Connected Cloud Summit, Cloud Channel Summit and Cloud Analytics Summit. Kaplan has over 30 years of experience in the high tech market. He began his career as an industry analyst at IDC, Dataquest and META Group. He then held marketing positions at International Network Services (INS) and InterOPS Management Solutions. He can be reached at [email protected] or 781-431-2690.

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