Technology infrastructure cloud computing and communication. Internet concept.
Image: Funtap/Adobe Stock

Infrastructure as a Service is a model for delivering information technology services in which the provider assembles computing infrastructure, often in the form of virtual machines, and makes it available to the customer over the internet. IaaS providers offer customers an on-demand self-service platform that enables them to deploy and manage applications without purchasing or maintaining hardware or software.

Jump to:

What is Infrastructure as a Service?

If you think of your organization’s IT infrastructure as a house, then IaaS would be the equivalent of renting that house rather than owning it outright. With IaaS, businesses can rent access to the physical or virtual resources they need to build and run applications and store data. These resources can include things like servers, storage, networking components and virtualization.

IaaS providers maintain the physical infrastructure, the hypervisor layer and security features such as identity and access management, while the enterprise remains responsible for operating systems, middleware, runtime environment, data and enterprise applications.

SEE: Hiring Kit: Cloud Engineer (TechRepublic Premium)

IaaS is a relatively new concept, but it has been gaining popularity in recent years. Some studies estimate that the IaaS market will exceed $481.8 billion by 2030, growing at a CAGR of 25.3% from 2021 to 2030, as more and more organizations look for ways to cut costs and increase agility. In many cases, IaaS provides a more cost-effective and flexible solution than traditional on-premises infrastructure.

Benefits of IaaS

There are several key benefits of IaaS that make it an attractive option for businesses.

Cost savings

One of the biggest benefits of IaaS is that it can help businesses save money. Running an enterprise application on traditional on-premises IT infrastructure requires a comprehensive stack of hardware, operating systems, middleware and application software. This is costly, and the organization bears all the responsibility for building and managing the infrastructure.

With IaaS, the business doesn’t have to own the IT resources to make productive use of them. In addition, most IaaS providers offer a pay-as-you-go pricing model, which allows businesses to only pay for the resources they use, which usually results in significant cost savings compared to traditional on-premises infrastructure.

However, there is a critical caveat to the cost-benefit. According to a recent cloud infrastructure report that surveyed 304 cloud IT and business stakeholders, 94% reported experiencing unexpected costs. The reasons cited for unexpected expenses include:

  • Lack of right-sizing
  • Failure to turn off unused instances
  • Low usage of cloud instances
  • Application migrations that don’t adjust architecture for cloud infrastructure
  • Unattached storage left alive when instances are disabled

Removes burden of IT management

Another key benefit of IaaS is that it can help businesses remove the burden of IT management. With traditional on-premises infrastructure, companies must purchase, install, configure and manage all of the hardware and software needed to run their applications. This requires a team of skilled IT professionals who are costly to maintain.

With IaaS, the provider manages all the infrastructure, which frees up the business’s IT team to focus on other tasks. This can help a company improve its competitiveness.


IaaS is also highly scalable, which means that businesses can easily add or remove resources as their needs change. This can be a major advantage for businesses that experience fluctuating demand or need to respond to changes in their environment quickly.

Flexibility and agility

IaaS gives businesses the flexibility to choose the type and quantity of resources they need as well as the location where those resources will be deployed. This degree of control can be helpful for businesses that have specific needs or requirements. IaaS also helps companies become more agile by quickly deploying new applications or services without going through a lengthy procurement process.

Drawbacks of IaaS

Despite its many advantages, IaaS does have some potential drawbacks that businesses should be aware of. These include:

Lack of control

When businesses outsource the management of their IT infrastructure to a third-party provider, they are no longer in control of that infrastructure. This can be an issue for companies with specific compliance or governance requirements.

For example, data sovereignty laws may require businesses to store their data in a certain location. A company using an IaaS provider may have difficulty pinpointing the location of its data. This creates a risk that the business may not comply with its legal or regulatory obligations.


Another potential drawback of IaaS is security. Because businesses don’t have direct control and lack clear visibility over their infrastructure, they may be less able to protect it from threats. This is a major concern for companies that handle sensitive data. For example, almost half of all cybersecurity attacks on IaaS infrastructure are fuelled by a lack of visibility.

However, there are instances when an IaaS provider may actually provide the organization with a better security posture than they could achieve on their own due to technical and resource constraints.

Features of IaaS

Not every provider offers the same features, but when implementing IaaS, there are certain features that businesses should look for:

  • Storage: Consider storage types, such as object, block and file storage; storage features, such as backup, restore and snapshotting; and storage management capabilities.
  • Compute: Evaluate the compute instances offered and features like autoscaling, load balancing and monitoring.
  • Databases: Consider the types of databases that are supported.
  • Networking: Evaluate the types of networks supported and features like firewall configuration and VPN access.
  • Security: Consider features like identity and access management, data encryption and activity logging.
  • Disaster recovery: Look for features like backup and recovery and the provider’s SLAs.
  • Service throughput: What is the speed between data centers, storage, virtual machines and applications?

At the end of the evaluation, you must factor in customer support and pricing. The IaaS provider’s customer service must be available when you need it and responsive, while the pricing model must be unambiguous. IaaS is a big decision for any business, so you want to make sure you are selecting the provider that best meets your needs.

Subscribe to the Cloud Insider Newsletter

This is your go-to resource for the latest news and tips on the following topics and more, XaaS, AWS, Microsoft Azure, DevOps, virtualization, the hybrid cloud, and cloud security. Delivered Mondays and Wednesdays

Subscribe to the Cloud Insider Newsletter

This is your go-to resource for the latest news and tips on the following topics and more, XaaS, AWS, Microsoft Azure, DevOps, virtualization, the hybrid cloud, and cloud security. Delivered Mondays and Wednesdays