Understanding difference technology terms

Understanding the difference – ASP, SaaS, Cloud


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In a technical conversation, when I hear the term Cloud, my blood pressure receives a momentary spike. Not because the person speaking the term is an idiot, not because the term is invalid, but because vendors are misusing it left and right and confusing the general public. I’m a marketing guy in spirit so of course I understand that you have to run after the trends and get the greatest value. Marketing terms go in and out like clothing fads, “Cloud” is no different. It happened with “SaaS”, and “ASP” (“Artificial Intelligence” is another and nearly gives me a heart attack but that is a different conversation ). Term miss-use is a technologist nightmare when they are trying to have a conversation about technology objectively. Recently at a trade show SaaS only companies had “Cloud” on all their marketing materials, at JavaONE I believe the only way I was able to enter any conversation was to start with “Happy Cloud to you”, and end with “May Cloud be with you”.

So if I could steal a few moments of your time to explain where these terms actually fit. Let’s start chronologically from their hype.

Application Service Provider ASP: About 11 years ago ASP was at it’s peak. While ASP was basically what was done in the early days with terminals before personal computers, it came back in a big way with more advanced applications and leveraging the convenience of PCs. I remember doing PR for one of the early players TriZetto who found one of the big niche markets for ASP, healthcare. Essentially in ASP the customer ( end-user ) owns ( likely leases ) a license to the application. Instead of it being installed on their machines they remote into the application and use it. All the application’s data is also stored in this remote location. I believe where ASP’s definition started to get blurred is when web apps became so robust they could be the ASP themselves. Examples include Google Docs. The primary difference between ASP and the others is the licensing, and how the license to use the software is owned by the end-user or customer.

Software as a Service SaaS: SaaS I believe is what most people are referring to when they use the term “Cloud”. From what I can tell SaaS in implementation is the most common of the three. In SaaS the customer does not own the license to the software but they purchase a right to use it on an as needed basis. The customer chooses a provider that has a services that solves their current need. For example converting images to text via OCR. The customer would upload documents to the provider, and download a result. The customer is paying either a per usage fee, per storage fee, or a monthly service fee. In most cases SaaS does not have UI in the form of a web app or client application like ASP, they tend to be geared to a single task vs. a complete application’s functionality. This next sentence is going to frustrate you most likely, Amazon’s services such as S3 is SaaS not Cloud.

Cloud: I shook as I wrote it. I don’t know if it’s because people love to use the word, but 90% of the time when I’m talking to someone about “Cloud” they mean SaaS. Think about its name, the purpose of “Cloud” is truly to send an input, it goes up in the Clouds, and gives you a result. Cloud could wrap around even multiple SaaS products and creators of Clouds be customers of them. To the end-user they know they need something done but don’t care about how or where. I’m still hard pressed to find a truly Cloud based service. In the spirit of Cloud a good example would be: I have an digital image, you have a digital image, we both want something done to the images and want to pay the lowest possible price. We don’t want to buy software nor concern ourselves with software. To my image I want it OCRed and converted to PDF, you want your image cropped, and compressed. We upload to a Cloud with our desired settings and the Cloud gets it done. We don’t know where the Cloud got OCR, PDF creation, cropping, or compression all we know is we got the lowest price for our request. Cloud is also used for large corporation as a infrastructure for quick deployment of similar environments. I believe this is where the confusion started being created, in many Cloud conversations they are talking about both the end-user perspective and implementer ( IT ) perspective, of course to the unaware that is confusing. To further the confusion Cloud’s product may consist of both ASP, SaaS, virtualization etc. A SaaS company may be using Cloud infrastructure to deliver the service. How more convoluted can it get.

If I were to generalize I would say ASP is for both consumer and enterprise and should be considered the equivalent of buying software of the shelf. I believe SaaS is really for corporations and not so much consumer. And finally I believe Cloud services are massively Consumer, or large corporation IT focused.

When it comes to technology terms are covered in vagueness and overuse. Because of this when I discuss technology I strictly adhere to the objective definition of the terms being used. This could explain why I’m so sensitive. It could just be nit-picking on my part, and the reality is that for most who talk about the above terms they are more or less the same thing. Many guys are only using the term to get the ladies or impress the boss or friend anyway. From an end-users perspective all are a perpetual paid for service of technology. From the implementation stand point, and when considering the advantages however they are all very different and not interchangeable.

is a bad-coder-turned-technology-advocate who understands the challenges and needs of modern engineers, as well as how technology fits into the business goals of companies in a demanding high-tech world. Chris speaks and engages with end-users regularly in the areas of modern AppDev, Site Reliability Engineering, DevOps, and Developer Relations. He was one of the original founders of the developer marketing agency Fixate IO, and currently works as a Sr. Manager in HubSpot’s Developer Relations team.


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