Infrastructure as a Service (IaaS): is in effect much like building a set of services and virtual machines and networks in a Cloud as the user would On-Premises.

But the difference is that, someone else is building and hosting the physical infrastructure for the user and the user chooses to configure the infrastructure that is fit for the application. For example: Amazon, Azure, Rackspace and so on. Here the user needs to go and set up the virtual machines, configure the networking, decide machine sizes, memory and cores. How the user wants the networking to fit with on-premise networking, how the user wants the IP addresses to work and so on. But the physical aspect is taken care of by the providers.

So here the user does not need to purchase software, servers, or network equipment. These are rented as a fully outsourced service that is usually billed depending on the amount of resources consumed.

Platform as a Service ( PaaS): A Platform is a cloud that gives the user various frameworks, tools and services on the cloud and the user are building the application in the cloud leveraging these various tools, services and components within the application. There could be services/applications such as for managing customer orders, monitoring shipments, invoicing clients, coordinating freight movements, reporting data for earth mining movements, underwater movements, accounting and billing and much more that can be built as a PaaS.

PaaS frameworks allow the user to create applications using software components that are controlled by the provider.

In a big organization with multiple divisions, a business process that is cut across divisions, can be thought of as a PaaS application catering to these divisions on a private cloud. A single team will be responsible for integration, tweaks and extension of the business process to various department needs. Thus this will not only reduce cost but ensure that the business process is indeed compliant in true respect throughout the organization.

  IaaS PaaS
Granularity of Control of Virtual Machines The user can remote into virtual machine running in the cloud using IDP. The user has the same level of control as the user would with a virtual machine on-premises. This means the user can get into the registry, install custom software the user want to install on that virtual machine. The PaaS provider takes care of running the application. It means that the user doesn't get access to registry and neither can the user install custom software necessarily in that application or in the location where it runs.

PaaS providers provide the infrastructure and the platforms.
Control over the environment configuration The user can choose a certain number of virtual cores, virtual CPUs, RAM, networking set up, how many different networks, virtual VPNs, separate subnets, extensions to on-premises networks and load-balancing across multiple VMs. PaaS can be thought of as the next step of IaaS where the configurations is also done for the user by the provider.
Maintenance The user is responsible for the O/S, patching, firewall management, security, data, runtime, applications, middleware and everything that's running inside of the VM because the user is responsible for that virtual machine. The only difference is the location of the VM; instead of on-premise it is in the cloud. The user still gets to do all the configurations but the user is relieved of doing the physical hardware things. The provider is responsible for application/services on PaaS. The user is just managing the various services.
Scalability The user is responsible for scalability. Scalability is the responsibility of the PaaS provider.
Pricing Subscription Model. Subscription Model, but it includes the cost of hardware for the installation of PaaS.

Both IaaS and PaaS help organizations to minimize operational costs and increase their productivity as they get faster time to market and requires no up-front investments.

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