Cloud-Based IAM vs. IDaaS: Understanding the Difference
Cloud-Based IAM and IDaaS: The Modern Standard for Identity
A cloud-based IAM platform is an Identity and Access Management solution delivered via the cloud. While often used interchangeably, it is important to distinguish between the broad category of Cloud IAM (which can include hosting your own servers in the cloud) and Identity-as-a-Service (IDaaS).
IDaaS is the specific SaaS delivery model where the vendor manages the infrastructure entirely. Customers connect their own on-premises and cloud systems to it over the public internet, consuming identity management as a subscription service.
What is a Cloud-Based IAM (IDaaS)?
An IAM platform manages digital identities (user accounts) and their access rights within an organisation’s IT environment. While the exact architecture differs per vendor, the design of HelloID (a true IDaaS solution) provides a clear example of the three essential modules:
Access Management: Real-time security for user sessions. This includes authentication and authorisation functionality, such as Single Sign-On (SSO) and adaptive Multi-Factor Authentication (MFA).
Provisioning: The automation engine that links users to accounts. HelloID uses Attribute-Based Access Control (ABAC), where rights are granted automatically based on user attributes like role, department, and location.
Service Automation: Functionality to automate self-service processes. For example, allowing users to request access to specific data or applications via a dashboard, which triggers an automated approval workflow.
The Hub-and-Spoke Architecture In this model, the IDaaS platform acts as the central hub. It connects to Source Systems (like HR packages that hold user details) and propagates changes to Target Systems (business applications where accounts must be created).
In a cloud-based model, the vendor is responsible for development, the technical roadmap, and platform security. As a customer, you consume the functionality as a service, allowing you to focus on functional administration rather than server maintenance.
Benefits of a Cloud IAM Platform
The benefits of IDaaS align with the broader advantages of cloud computing (SaaS), with specific value for security teams:
Scalable Solutions: The 'pay-as-you-go' model allows costs to scale with your usage. You pay according to the number of users and modules required, without needing to over-provision hardware for future growth.
Flexible Integration: Modern IT environments are increasingly cloud-first. Connecting SaaS applications (Target Systems) to a cloud-based IAM is native and efficient.
Functional Focus: Technical platform management (capacity, reliability, uptime) rests entirely with the service provider. Your IT staff can stop "keeping the lights on" and focus on functional improvements, such as configuring new security policies.
Always Up-to-Date: The IDaaS provider manages the roadmap. You receive new features and security patches continuously without downtime. You never need to plan a complex "upgrade project" to get the latest version.
Cloud vs. On-Premises IAM
While the market is shifting to IDaaS, some organisations still choose on-premises IAM platforms.
The "Installed Base" Case: If you invested heavily in an on-premises solution recently and it still meets your performance needs, it makes sense to follow the lifecycle and avoid writing off software prematurely.
The "Control" Case: Very large organisations or those with strict data sovereignty requirements (e.g., Defence) may require absolute control over the code and database, necessitating an on-premises or private cloud deployment.
However, for most organisations, the move to cloud-native tools (Microsoft 365, Google Workspace) makes an on-premises IAM counter-intuitive. Managing cloud identities from a local server often adds unnecessary complexity.
Multi-Tenant vs. Single-Tenant Cloud IAM
When selecting a cloud solution, you will encounter two primary architectures:
Single-Tenant (Private Cloud): You have a dedicated cloud environment containing only your data and configuration.
Pros: Higher control over update schedules and customisations.
Cons: Higher cost, more complex management, and you may lag behind on feature updates.
Multi-Tenant (SaaS / HelloID): Customers share a single, scalable cloud platform managed centrally by the provider.
Pros: Efficiency, lower TCO, and immediate access to new features.
Security: Customer data remains strictly logically segregated. The provider handles redundancy and performance, removing the technical burden from your team.
For mid-sized and most enterprise customers, multi-tenant IDaaS offers the best balance of performance, security, and cost.
Multi-Cloud IAM Solution
Many organisations now operate a "Multi-Cloud" strategy, using services from Microsoft Azure, Google Cloud, and AWS simultaneously. You want to harmonise access across these disparate environments.
A Multi-Cloud IAM is not an IAM hosted in multiple places; it is a single identity control plane that manages access across multiple clouds.
Centralised Identity: One platform to create and revoke accounts across Azure, AWS, and Google.
Uniform Policy: Apply the same security rules (e.g., MFA requirements) regardless of where the application is hosted.
Compliance: Maintain a single audit trail. You can see who accessed what, across any cloud, from one dashboard.
Hybrid IAM Solution
Realistically, most organisations are Hybrid. They use modern cloud services (SaaS) but still rely on legacy on-premises applications (like an ERP or legacy Active Directory).
A Hybrid IAM solution bridges this gap. It runs in the cloud but uses secure connectors (agents) to manage on-premises systems. This gives you the "best of both worlds": the ease of management of the cloud, with the ability to control legacy systems that cannot be moved to the internet.
Want to learn more about the HelloID cloud IAM solution?
Explore our HelloID platform to learn how you can use this IDaaS solution to manage accounts and rights across your hybrid, multi-cloud environment.