Infrastructure as a service (IaaS)

Definition

IaaS providers offer virtualised computing resources, including virtual machines (VMs) or containers, which enable clients to run applications and workloads without managing physical hardware.

What is infrastructure as a service?

In an IaaS model, a third-party provider hosts and manages the hardware infrastructure, including servers, storage, networking, and virtualisation technology, while clients rent these resources on a pay-as-you-go basis. Clients can then scale computing resources up or down based on demand, allowing for flexibility and cost-efficiency.

IaaS providers offer networking services, such as virtual networks, load balancers, firewalls, and VPNs, to enable connectivity between different components of the infrastructure and to the internet. Clients can configure network settings and security policies to meet their specific requirements.

Furthermore, IaaS providers offer management tools and dashboards that allow clients to provision, monitor, and manage their infrastructure resources easily. Clients can deploy and configure virtual machines, manage storage, and monitor performance metrics through a centralised interface.

Benefits of Infrastructure as a service include:

  • Scalability: Clients can scale computing resources up or down quickly to accommodate changing workload demands.
  • Flexibility: Clients have the flexibility to choose the specific computing, storage, and networking resources they need based on their unique requirements.
  • Cost savings: IaaS eliminates the need for upfront capital expenditures on hardware infrastructure and reduces ongoing operational costs.
  • Reliability: IaaS providers offer robust infrastructure with high availability and fault tolerance to ensure reliable service delivery.

Example of infrastructure as a service

ABC Corporation, a software development company, needs to host its application on a scalable and reliable infrastructure without managing physical hardware. Instead of investing in on-premises servers, ABC Corporation decides to use an IaaS provider.

ABC Corporation signs up for an IaaS subscription with the chosen provider and selects the computing, storage, and networking resources they need for their application.

Once the VMs are provided, ABC Corporation installs and configures their application software on the virtual instances. They also set up networking configurations, such as virtual networks, subnets, and security groups, to ensure connectivity and security for their application.

As the application’s demand fluctuates, ABC Corporation can easily scale their infrastructure up or down by adding or removing VM instances or adjusting resource allocations. They only pay for the resources they use, avoiding upfront hardware costs and reducing operational overhead.

Ready to grow your business?

Clever finance tips and the latest news

Delivered to your inbox monthly

Join the 110,000+ businesses just like yours getting the Swoop newsletter.

Free. No spam. Opt out whenever you like.

We work with world class partners to help us support businesses with finance

Swoop Finance Limited helps UK firms access business finance by working directly with businesses and their trusted advisors. We act as a credit broker, not a lender, and do not provide loans or finance products ourselves. We introduce applicants to a panel of lenders, equity funds, and grant agencies based on individual circumstances and creditworthiness.
Commission Disclosure: We typically receive a commission from the finance provider (either a fixed fee or a fixed percentage of the amount you receive) upon successful placement. Different providers pay different rates. For certain lenders, we may have influence over the interest rate, which can impact the total amount payable under your agreement.
Regulatory Information:

  • FCA: Authorised and regulated by the Financial Conduct Authority as a credit broker (FRN: 936513) and registered as an Account Information Services Provider (Ref: 833145).

  • ICO: Registered with the Information Commissioner’s Office (Ref: ZA600162); registration can be verified at ico.org.uk.

  • Company Details: Registered in England & Wales with Companies House (No. 11163382). Registered Address: The Stable Yard, Vicarage Road, Stony Stratford, Milton Keynes, MK11 1BN. VAT Number: 300080279.

Terms: All finance and quotes are subject to status, income, and terms and conditions. Applicants must be aged 18 or over. Guarantees and indemnities may be required. Please refer to our terms and conditions and our complaints procedure for further details.

© Swoop 2026

Looks like you're in . Go to our site to find relevant products for your country. Go to Swoop