What Is IaaS? Infrastructure-as-a-Service Explained

As one of those techy abbreviations, IaaS or Infrastructure-as-a-Service (as the not-so-cool kids call it) seems to pop up left and right these days. For good reason – it’s a model that effectively minimizes the ever-present cost and complexity of computing.

Simply put, IaaS is a way for businesses to rent computing resources like servers, storage, and networking rather than having to buy and maintain hardware themselves.

Cloud hardware is expensive to purchase and look after, and it takes time to get your hands on the stuff you need (procuring equipment can take months) — that’s time most companies don’t have in today’s dynamic landscape.

So, having an on-demand option for essential resources is more practical and can save you a hefty amount in upfront costs since you only pay for what you use.

An IaaS provider acts as a host and supplies you with the resources you require. You will access them virtually. The provider manages and upkeeps the infrastructure, while you configure and run your workloads, apps, and whatnot.

Core Components of IaaS

A typical IaaS package, so to speak, consists of:

• Virtual Machines (VMs): Software-based computers that run on a physical server and exist as codes, each with an operating system.
• Storage: Three types of cloud storage resources that include block storage for storing data in blocks, file storage for storing data in files, and object storage for storing static unstructured data.
• Networking: Virtualized instances of routers, switches, firewalls, and load balancers accessible through APIs, allowing you to connect to IaaS from anywhere in the world.
• Compute Power: All the CPUs, GPUs, and RAM required to perform any task provisioned in the form of virtual machines.
• Data Centers: Global facilities housing the physical servers that serve as a backbone for creating different levels of abstraction (virtual network constructs).

As you can see, this is a mix of physical and virtualized resources that enable organizations to be more flexible and run their workloads in the cloud.

The Virtualization Layer

Virtualization refers to the creation of a virtualized instance of a physical computer with dedicated CPU, memory, and storage. Thanks to this process, IaaS providers can abstract physical hardware and provide resources in a flexible and scalable way, often creating multiple VMs from a single machine.

Since every VM exists within the virtualization layer, “someone” needs to separate them so everyone plays nice with each other. This is the role of hypervisors, also known as virtual machine managers (VMMs). They create and manage virtual machines, ensuring isolation between workloads by assigning an independent guest OS and dedicated computing resources.

That way, each VM acts as a de facto computer — despite really being a partition of the system.

API Access and Automation

IaaS APIs act as an interface between IaaS platforms and businesses. They essentially tell servers and related infrastructure-level software what to do, which is how you, as a user, ultimately get to provision, manage, and automate the underlying infrastructure.

Setting up this virtual ecosystem isn’t feasible without automated processes and software. They make it much easier to perform tasks like configuring, deploying, and provisioning infrastructure instead of doing things manually. I think anyone who’s attempted a DIY project knows doing something manually can take a long time.

As you consider moving away from on-premises IT solutions, it’s important to understand what IaaS brings to the table.

On-Demand Scalability

Because you rent cloud computing infrastructure, you get access to virtually limitless resources that precisely accommodate your needs.

You can scale resources up or down based on demand, thus avoiding over-provisioning or underutilization along the way.

One example is scaling web applications during peak traffic periods – think of online stores during the holiday season.

You can just add a new server to handle the increased traffic and later scale back when things go back to normal.

Pay-as-You-Go Pricing

You fork over cash only for the resources you use hourly, daily, or monthly and you get to keep your expenses under control and in line with your budget. Not only does this pricing make IaaS affordable, but it also grants your business much-needed flexibility to grapple with challenges as they arise.

This is a stark contrast to the traditional data center model, where you need a sizable upfront investment. Also, it’s not exactly efficient to buy, configure, and maintain computing resources yourself and then repeat the process every time there’s a spike in demand — and then resources sit idle in off-peak times.

Disaster Recovery and Backup

Owing to the inherently reliable nature of the cloud, IaaS providers offer better disaster recovery options compared to on-premises deployments.

Thanks to multiple failover, replication, and backup services, along with distribution across different locations, IaaS is proactive instead of reactive.

As a result, you can easily move or replicate your apps and workloads in the cloud without experiencing loss.

In the same vein, you can ensure business continuity and data integrity even in case of hardware failures or disasters by periodically syncing data backups and relying on cloud-based copies when and if needed.

High Availability and Redundancy

To make sure the lights never go out, built-in redundancy exists at every level and is distributed across multiple regions and availability zones that have independent power, cooling, and networking infrastructure. This eliminates the single point of failure, making IaaS more reliable and resilient than traditional alternatives.

Also, via service-level agreements, the provider sees to it that your infrastructure is dependable and meets certain standards of performance.

It’s worth mentioning the roles of load balancing and failover mechanisms in optimizing resource usage and improving overall system responsiveness. The former distributes incoming traffic across multiple servers, thus helping prevent bottlenecks. In the event of a component failure, failover procedures automatically redirect traffic to a redundant component. That minimizes downtime.

Security and Compliance

Though there is some debate regarding how secure the cloud really is compared to on-premises environments, the reality is that IaaS vendors offer robust security features.

Firewalls, encryption, and identity and access management solutions are in place to protect customer data. Plus, you have other procedures and safeguards that keep the entire infrastructure safe.

IaaS providers also assist businesses in complying with regulations like GDPR, HIPAA, and PCI DSS by providing compliance certifications like ISO/IEC 27001.

By inheriting the provider’s security measures, companies can confidently deploy applications in the cloud while adhering to regulatory mandates.

Customizability

Arguably the most versatile cloud-based model, IaaS grants you the freedom to choose the exact resources you need and tailor them to fit your project perfectly. This includes customizing networking setups, scaling virtual machines up or down, and choosing from a variety of storage options.

The resulting flexibility allows businesses to optimize their cloud infrastructure for performance, cost-efficiency, and scalability. Though you’re still solely relying on what the IaaS vendor supports, such a high level of customization is likely to be satisfactory for most customers.

With IaaS, you get a powerful, customizable tool at your fingertips, and that comes with plenty of perks.

Cost Efficiency

The big pro here is that you don’t have to spend a ton of money on hardware and infrastructure upfront. The lack of capital expenditure in that regard means IaaS is financially doable for startups and small businesses that typically have finite money in their bank accounts.

IaaS minimizes hardware costs and maintenance, effectively lowering the barrier for entry.

The economical nature of IaaS is also reflected in the predictability of future costs. Because resources are used on demand and you only pay for those you use, you can get a pretty good estimate of operational expenses based on factors like maintenance, cooling, and staffing. This unlocks long-term cost savings and makes it easier to plan and budget for your cloud needs.

Flexibility and Agility

Another side of on-demand computing services is that businesses can deploy and scale their infrastructure as required, whether it’s to beef it up or reduce its size. In a matter of minutes, you can quickly adapt to changing business needs and deliver optimal performance of IT workloads.

Because you don’t need to set up and spin up the underlying infrastructure, IaaS lets you test new ideas in a pinch, which is a pretty big competitive advantage. For example, IaaS allows for rapid prototyping and iteration. That enables agile development teams to experiment and refine their products swiftly.

Thanks to IaaS, you can considerably speed up development and time to market (otherwise, you’d have to wait for days) and deliver your products or services to users faster. In a way, you could say that IaaS fosters innovation.

Global Reach

Cloud providers routinely use a global network of data centers to not only make sure your services are always up and running but also that you can grow your online footprint. Having a presence all over the world leads to greater availability and resiliency since it lowers latency and boosts performance by placing products and services in areas near your end users. For instance:

• Google Cloud has infrastructure services available in locations across North America, South America, Europe, Asia, the Middle East, and Australia, further divided into regions and zones.
• Similarly, Microsoft Azure has specific Azure geographies that contain one or more regions and meet specific data residency and compliance requirements.

The bottom line is that IaaS is available in most geographies and leading vendors are constantly expanding their networks, especially when it comes to large population centers. Whatever your latency and availability needs may be, it’s more than likely that you’ll find a suitable location for your business-critical data and apps.

Reduced IT Complexity

I’m not a business owner nor a decision-maker in charge of bringing digital transformation to an organization, so I can’t speak from experience here. However, I’d like to think that a huge part of IaaS’ value stems from the convenience of letting someone else worry about the infrastructure. Basically, you outsource hardware updates, patching, and all the maintenance stuff to the provider.

Yes, it’s a simplified and more efficient IT resource management, but there’s more to it. Think about it: You don’t have to worry about the nitty-gritty details of managing physical infrastructure and keeping your system tidy at all times. You’re free to concentrate on your core competencies and innovation — you can do the strategic work that makes your business competitive.

Benefits aside, the path to IaaS stardom is strewn with several roadblocks that might not be easy for everyone to avoid.

Security Concerns

Because of the way the technology works, you’re just one of many customers who share the same physical infrastructure. That carries potential security risks since the safeguarding responsibilities are shared between you and other customers on one side and the provider on the other.

For starters, you can’t know how good one’s security hygiene is and how diligent (or knowledgeable, for that matter) they are. There could be opportunities for unauthorized access, especially if someone misconfigured security settings on their VM, such as:

• Open ports
• Insecure APIs
• Poor firewall rules
• Lax access restrictions (weak passwords included)

Attackers also might be able to extract sensitive information from your VM by observing what other tenants do on the same physical server. And if you or your IaaS provider fail to follow industry-specific compliance and regulatory requirements (another joint obligation), you could face financial penalties or even legal troubles.

Then, there’s the undeniable fact that your IaaS is only as secure as your provider makes it. You have no say in how they do anything when it comes to security — though they certainly do their damnedest to make sure everything is as it should be.

Vendor Lock-In

The biggest danger of being dependent on a single IaaS provider is getting locked in their ecosystem. This can be problematic if you want to migrate workloads, change databases, or negotiate more favorable terms. These scenarios mandate sizable expenditures for resolution and can lead to business disruptions. You don’t want any of that.

Vendor lock-in is a concern too because there are no guarantees that the vendor won’t radically alter their service in a way that no longer makes sense for your business needs. And who’s to say they won’t hike up their prices, knowing full well you’re super reliant on their technology?

To avoid these issues, your best bet is to use a multicloud or hybrid cloud approach.

Using multiple IaaS providers or a combination of public and private clouds to distribute your workloads increases your flexibility and leverages the best of each platform.

It’s also prudent to keep internal backups and have data formatted in a way that allows more vendors to use it. Don’t put all your eggs in one vendor’s basket.

Performance Variability

The downside of virtualization is that compute-intensive activities from another user may impact the bandwidth set aside for you. Unfortunately, that subpar underlying infrastructure and network conditions may impact the quality of connectivity and the performance of processes dependent on IaaS infrastructure. To put it bluntly, if the performance is up and down, you’ll get a big problem on your hands.

The most direct way to protect yourself against such unpredictability is to be precise about what your workload is like and what you want to achieve in terms of performance. Then, compare different IaaS providers to see how they stack up against industry standards. These benchmarks should put you at ease that the provider in question is doing things the right way.

You’ll also want to negotiate a contract that guarantees they’ll meet your expectations, so you can hold them accountable if performance dips. Alternatively, consider solutions like dedicated hosting or exclusive resources. They offer predictable performance and the option to optimize the configuration to your liking. This is particularly helpful if your applications and specialized workload require high consistency.

Complexity in Management

As I’ve explained in earlier sections, quite a few responsibilities fall on your shoulders no matter what vendor you use. While your job is significantly easier with the brunt of the burden of hardware management being on the provider, you still need a little bit of know-how. After all, you have to configure VMs, manage storage and networking, and enforce security to make the most out of your setup.

So, a deeper understanding of best practices (which I help with below) is certainly advisable. If you don’t have the necessary skills, you’ll need to open your wallet and hire someone, which adds to your operational expenses.

Having insights into what’s going on in the background is ultimately going to minimize costs and errors. This is the part of the article where I save you money and headaches.

You need a dashboard to monitor performance and make adjustments, which is where cloud management tools come in. These provide a one-stop shop for your IaaS resources, allowing you to monitor usage, identify trends, and optimize performance as needed.

Let’s take a brief look at the top three names in this $140 billion market.

Use cases for IaaS extend to an array of industries, courtesy of its exceptionally flexible infrastructure. Here are some of the most common ones:

Hosting Websites and Applications

From mobile apps to all kinds of websites, IaaS has all the ingredients for a business to swiftly deploy its software. This is especially true for dynamic sites and apps that have varying traffic demands. You can custom configure an IaaS environment and then effortlessly scale resources according to load.

Examples abound:

• Online retailers such as Amazon and eBay rely on IaaS, including virtual machines, storage, and networking, to handle fluctuating traffic and ensure a seamless user experience.
• Netflix’s infrastructure is a hybrid model, blending IaaS elements with microservices architecture to deliver high-quality streaming content across the globe.
• Gaming company Epic Games uses IaaS for numerous activities, from powering their multiplayer games and handling millions of concurrent players to backend services, databases, and analytics pipelines.

I could go on — the point is that if you need a reliable and high-performance experience for your users, IaaS is one of the best solutions out there.

Big Data and Analytics

Regardless of the size of a dataset, IaaS can cope with it due to its native ability to deliver computing and processing power upon request. It’s the primary reason why it’s used for big data processing and analytics workloads that call for massive computing power and storage capabilities. Plus, traditional on-premises setups are expensive and inflexible, so there’s that too.

Here are a few case studies where businesses use IaaS for large datasets, machine learning, or business intelligence:

• Uber leverages IaaS to process more than 1 exabyte of data across tens of thousands of servers, including batch data analytics and ML training stack.
• Spotify uses IaaS to process massive data volumes from its more than 600 million users and analyze their listening preferences to create personalized playlists and recommendations.
• Similarly, Walmart employs IaaS for customer data analysis to understand customer habits and improve their shopping experience via generative AI search functions.

These examples demonstrate the potential and versatility of IaaS in powering a wide range of data-driven applications across various industries.

Disaster Recovery and Backup

It’s no secret that keeping data safe and having a plan for what to do if something goes wrong is a lot of work. It’s also costly if we’re talking about storing data on your computers or investing in a physical location. By using the IaaS, you get a cost-effective solution for disaster recovery that also frees up your team to do other important tasks.

The great thing about IaaS is that it automatically backs up and replicates your data to a different location in the cloud. This way, if something bad happens, you’ll still have a recent version of your critical data and applications, which is exactly how (and why) many businesses apply IaaS. With automated backup and failover processes, there is little to no downtime in the event of a disaster.

Development and Testing

With its quick setup and provisioning, IaaS is a great choice for test and development environments that don’t break the bank. DevOps teams can create virtual environments with specific configurations to isolate their projects and guarantee consistency.

Access to computing resources means devs can freely experiment and iterate on their projects without investing in expensive on-premises hardware.

Speaking of DevOps, IaaS acts as a foundation for CI/CD pipelines and helps get your software out the door faster and with fewer problems. By connecting your code changes to your cloud infrastructure, you can automate the build, test, and deployment processes. You can also pinpoint bugs early — effectively making sure the code checks out (even if it’s older).

Enterprise IT Infrastructure

A fair share of enterprises still rely on their legacy infrastructures. Since IaaS supports both cloud and traditional enterprise apps, it allows enterprises to easily extend and move their systems in alignment with their growth. This shift simplifies operations and adds a global reach, thus providing flexibility (and cost savings in terms of CapEx and OpEx, let’s not forget) to speedily react in the dynamic corporate environment.

A good example is migrating ERP systems and databases to the cloud where these traditional IT workloads are enjoying a new lease on life. Through cloud-enabled virtual automation, they are modified to drive greater standardization and take advantage of available cloud-native capabilities.

This is the part where we take a look at those other “as-a-Service” acronyms and see what’s what. Each is a slightly different cloud computing service model, so whether one will suit you will depend on the level of responsibility and control you’re comfortable with assuming.

IaaS vs. PaaS (Platform as a Service)

The biggest difference is that IaaS provides raw infrastructure, like servers, storage, and networking, while PaaS offers a managed platform for application development, including tools, frameworks, and runtime environments. That means:

• You have full control over the configuration of your cloud resources in IaaS, while PaaS grants you control over the application development environment.
• PaaS is less flexible because it’s preconfigured with specific tools and frameworks.

So which one do you choose? Well, IaaS is great if you want full control over your infrastructure, need custom setups, and have the tech know-how. You’ll manage everything from the operating system to storage and network settings.

PaaS is a better choice in case you’re more focused on building apps and don’t want to bother with the everyday hassle of infrastructure. It’s ideal for speeding up development and simplifying the management of hardware and software.

IaaS vs. SaaS (Software as a Service)

Think of SaaS as the whole package, since it supplies a ready-to-go app you can use right away. The provider takes care of all the updates, fixes, and upkeep, so you don’t need any in-house IT staff.

Most SaaS apps like Salesforce, Google Workspace, and others work straight from the web browser, so you don’t need to install anything.

That said, it all boils down to what matters more to you. Do you want custom application development or the convenience of using standardized solutions? IaaS offers greater flexibility to build and deploy apps that closely align with your requirements, while SaaS delivers user-friendly applications that typically require minimal training and maintenance.

IaaS vs. On-Premises Infrastructure

I know I’ve portrayed the traditional on-premises infrastructure as a sort of big bad wolf of IT, but facts are facts when you compare the two:

It should be obvious why many businesses look to IaaS as the solution to minimize costs and adapt to changing demands. However, on-premises infrastructure still has its uses, and it may be more suitable for businesses that prefer complete control over their IT environment or have strict data security requirements.

To make the most out of your IaaS plan, the key is to focus on these areas:

Cost Optimization

As with everything, managing costs is a big deal. So, you might want to think about reserved instances — resources purchased in advance for a set period in exchange for a reduced price. Compared to on-demand pricing, these provide a considerable discount, either upfront or through a monthly fee.

Another strategy (more like the sensible thing to do) is to optimize workloads. Not all of them need the same resources, so make sure to monitor and analyze them on a regular basis to uncover if some are overprovisioned or underutilized. You have plenty of tools for the job, such as Amazon CloudWatch, Azure Monitor, and so on. The same applies to storage, btw.

This brings us to rightsizing, the basic principle of resource optimization that’s all about matching resources to the actual workload requirements. There’s no point in paying big or small bucks for resources that are just sitting idle, so the key is to understand from the get-go what infrastructure size is adequate for your workload. Also, you can try demand-based auto-scaling policies for dynamic resource adjustment.

Security in IaaS

The first step is to shore up your defenses through an identity and access management (IAM) framework. It’s the best way (so far) to control who can and can’t access your resources. That ensures only the right users get entry and do their jobs. This includes using multi-factor and passwordless authentication, role-based access control, and all sorts of policies that keep the wrong people out of your business.

Most IaaS platforms (and IAM tools) offer some level of encryption to protect your sensitive data both at rest and in transit. You should pay special attention to the former as it’s more of a proactive measure. You want a situation where data remains unreadable even in case of unpermitted access since there are no required decryption keys.

Being proactive goes a long way, so keep an eye on network traffic for any weird patterns and scan for vulnerabilities every so often. Doing so helps your company spot and deal with security problems promptly, making your IaaS setup more resilient.

Finally, be very clear on what your duties are. In IaaS, security is a team effort. The provider secures the underlying infrastructure, while your job is to secure the operating systems, applications, and data running on top of it. You are responsible for your data — period.

Disaster Recovery Planning

The best way to prepare (and protect) your infrastructure from disaster is to plan.

You can use IaaS for disaster recovery (DR) in two ways:

• Replication: Keep your on-premises data synced with the cloud in real time. If something goes wrong, you can switch pronto to the cloud copy instead of doing a long and stressful recovery.
• Cloud Hosting: Move your workloads to the cloud ahead of time. Think of it like a safety net. This protects your business from outages and keeps things running smoothly.

My advice is to automate as much of your recovery process as possible to minimize manual intervention and the risk of human error.

As the foundational layer of cloud computing, IaaS offers a world of possibilities to optimize your IT infrastructure and achieve greater flexibility, scalability, and cost-efficiency.

Who wouldn’t want all the perks of having your servers and technical stuff but for a lot less money and without the hassle of buying, setting up, updating, or maintaining them yourself?

Just make sure to do your homework and pick the right IaaS provider (look at how they handle security, what they’re responsible for, etc.). It’s really important to know what to expect before you make a choice.