Three core options compose the service model within the cloud computing environment.
Each service category can be leveraged independently or consumed in combination with other service tiers.
SaaS comprises end-user applications delivered as a service rather than as traditional, on-premises software. The most commonly referenced example of SaaS is Salesforce.com, which provides a customer relationship management (CRM) system accessible via the Internet.
PaaS provides an application platform, or middleware, as a service on which developers can build and deploy custom applications. Common solutions provided in this tier range from APIs and tools to database and business process management systems to security integration, allowing developers to build applications and run them on the infrastructure that the cloud vendor owns and maintains. Microsoft's Windows Azure platform services are often referenced as PaaS solutions at this middleware tier.
IaaS primarily encompasses the hardware and technology for computing power, storage, operating systems, or other infrastructure, delivered as off-premise, on-demand services rather than as dedicated, on-site resources such as the Amazon Elastic Compute Cloud (Amazon EC2).