Cloud Service Models - explained in an easy way

There are three basic service models in which cloud operates.

Service models

Cloud computing providers offer their services according to three fundamental models:

Infrastructure as a service (IaaS)

In the most basic cloud-service model. Providers of IaaS offer computers physical or (more often) virtual machines – and other resources. A hypervisor, such as Xen, Oracle VirtualBox, KVM, VMware ESX/ESXi, or Hyper-V runs the virtual machines as guests. 

There are Pools of hypervisors within the cloud operational support-system. All these hypervisors can support large numbers of virtual machines and they have the ability to scale services up and down according to customers' varying requirements. 

IaaS clouds often offer additional resources such as a virtual-machine disk image library, raw block storage, and file or object storage, firewalls, load balancers, IP addresses, virtual local area networks (VLANs), and software bundles. IaaS-cloud providers supply these resources on-demand from their large pools installed in data centers. For wide-area connectivity, customers can use either the Internet or carrier clouds (dedicated virtual private networks).

To deploy their applications, cloud users install operating-system images and their application software on the cloud infrastructure. In this model, the cloud user  maintains the operating systems and the application software thenselves. Cloud providers typically bill IaaS services on a utility computing basis: cost reflects the amount of resources allocated and consumed.

Platform as a service (PaaS)

In the PaaS models, cloud providers deliver a computing platform, typically including operating system, programming language execution environment, database, and web server. Application developers can develop and run their software solutions on a cloud platform without the cost and complexity of buying and managing the underlying hardware and software layers. With some PaaS offers like Microsoft Azure and Google App Engine, the underlying computer and storage resources scale automatically to match application demand so that the cloud user does not have to allocate resources manually. The latter has also been proposed by an architecture aiming to facilitate real-time in cloud environments.Even more specific application types can be provided via PaaS, e.g., such as media encoding as provided by services as bitcodin transcoding cloud or

Software as a service (SaaS)

In the business model using software as a service (SaaS), users are provided access to application software and databases. Cloud providers manage the infrastructure and platforms that run the applications. SaaS is sometimes referred to as "on-demand software" and is usually priced on a pay-per-use basis or using a subscription fee.

In the SaaS model, cloud providers install and operate application software in the cloud and cloud users access the software from cloud clients. Cloud users do not manage the cloud infrastructure and platform where the application runs. This eliminates the need to install and run the application on the cloud user's own computers, which simplifies maintenance and support. Cloud applications are different from other applications in their scalability—which can be achieved by cloning tasks onto multiple virtual machines at run-time to meet changing work demand.Load balancers distribute the work over the set of virtual machines. This process is transparent to the cloud user, who sees only a single access point. To accommodate a large number of cloud users, cloud applications can be multitenant, that is, any machine serves more than one cloud user organization.

The pricing model for SaaS applications is typically a monthly or yearly flat fee per user,so price is scalable and adjustable if users are added or removed at any point.

Proponents claim SaaS allows a business the potential to reduce IT operational costs by outsourcing hardware and software maintenance and support to the cloud provider. This enables the business to reallocate IT operations costs away from hardware/software spending and personnel expenses, towards meeting other goals. In addition, with applications hosted centrally, updates can be released without the need for users to install new software. One drawback of SaaS is that the users' data are stored on the cloud provider's server. As a result, there could be unauthorized access to the data. For this reason, users are increasingly adopting intelligent third-party key management systems to help secure their data.