Cloud Services vs. Managed Services vs. Hosted Services – What’s the Difference?

When it comes to IT and software, most business owners rely on assistance from a professional. After all, there are myriad benefits to outsourcing the management and development of your technology infrastructure rather than keeping it in-house.

For instance, you might enjoy better service plus cost savings by outsourcing. A specialized team typically offers your company a superior skill set at a lower price than if you were to hire several full-time employees. In the latter case, you might need one versed in each software development, database management, disaster recovery, and cybersecurity.

Still, it can be challenging to decide which type of outsourced IT services are best for your team. You’ll likely hear terms like cloud services, managed services, and hosted services while shopping around for the right technology success partner. But what exactly are the differences? What are the pros and cons of each type of provider?

Confusing, Interrelated Terms

When it comes to technology and computing, there are many terms that are often used interchangeably or misunderstood. Managed services, cloud services, and hosted services are among these confusing terms.

While they all relate to the idea of outsourcing technology services to a third party, there are some nuances and differences in their definitions. The overlap between the terms, and the idea that different technology solutions providers label the same services in different ways, makes defining the terms particularly challenging.

Cloud Services and Cybersecurity

Cloud services have become increasingly popular in recent years, but they also pose a range of cybersecurity threats to businesses. Businesses trust CSPs to manage cloud resources and technologies. Still, a lack of oversight and too many entry points can be problematic for cloud applications from a security perspective.

As cloud service providers handle cloud management and data backup, they also have access to sensitive customer data stored in the cloud. This could leave customers vulnerable to data breaches or malicious attacks such as Distributed Denial of Service (DDoS).

In order to mitigate cloud security risks, CSPs should develop a cloud security strategy that outlines their cloud management and data backup processes. Business customers are advised to always read their CSP’s terms of service and privacy policy carefully. This way, they will understand how the provider is managing customer data. By taking these measures, cloud customers can ensure their cloud-based data is protected and secure.

What are Managed Services?

If you’ve been considering cloud hosting or other cloud computing services for your business, you may have stumbled across the term “managed services.” If you’re wondering, “What are managed services,” or “How are managed services different from cloud services,” you’re not alone.

Managed services refer to outsourcing IT services to a third-party provider. This could include anything from network and server maintenance to security and data backup. The key feature of managed services is that the provider takes care of all the details of the service, leaving the client with a turnkey solution. This means that the client can focus on their business, while the provider takes care of the technology.

The Managed Service Provider (MSP) has the resources, such as server hardware, software, and storage capacity, necessary to allow customers to run cloud applications. In addition, they can also monitor cloud performance, provide support services, handle backup and disaster recovery, and assist with cybersecurity best practice implementation.

MSPs offer a range of cloud-based services for businesses of all sizes. These cloud-based services are generally easier to implement and manage than traditional IT systems, and they also provide more flexibility in terms of scalability and cost-effectiveness.

What are Cloud Service Providers?

Cloud services refer to services that are delivered over the internet, as opposed to being hosted on a physical server. Cloud service providers (CSPs) offer a range of services, from infrastructure as a service (IaaS) to software as a service (SaaS).

While CSPs often offer managed services, they can also offer unmanaged services, where the client is responsible for managing the service themselves. Thus, cloud services are not necessarily managed services, but they often are. Sometimes, the infrastructure level is managed and it’s up to the client to provide the implementation of the systems running, or vice versa. The salient requirement is that cloud services must exist on the cloud.

The CSP is responsible for managing cloud infrastructure, virtual machines, cloud storage, and cloud applications. Services in cloud computing may include Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS).

Cloud services offer some advantages to businesses. These include the fact that cloud solutions are largely scalable. Cloud providers can quickly adapt solutions as business needs change and grow, without investing in additional hardware or software. This scalability also enables businesses to only pay for the cloud services they require at any given time.

However, this must be balanced carefully to mitigate potential resource overruns. True ownership costs can be reduced by a good CSP that is cognizant of the many subtle billing factors that could otherwise be painful.

What are Hosted Services?

Hosted services refer to any service that is hosted externally, regardless of whether it is on the cloud or not. This could include website hosting or email hosting, among others.

Hosted services are often managed services, but they can also be unmanaged. It’s also possible for a third party to utilize a client’s in-house hardware to host a service for them, which would also be considered a hosted service. They are generally also a cloud service, too, though it’s possible to have a 3rd party utilize your in-house hardware to host a service for you.

The term “hosted services” is somewhat antiquated, and you probably should take any reference to such with a grain of salt, as it could mean so many different things. When you do hear people refer to hosted services, they may be referring to something like a website host like GoDaddy, a WordPress host, or really any service that is hosted externally (by anyone, including a CSP or MSP).


While managed services are the most important concept of the three, it’s worth understanding the differences between cloud services and hosted services. The cloud is simply someone else’s computer, and CSPs offer a range of services that can be both managed and unmanaged. Hosted services refer to any externally hosted service, regardless of whether it is on the cloud or not. It’s important to understand these terms when outsourcing technology services, as they can help you find the right provider for your needs.

Whether cloud services, managed services, hosted services, or some combination of these interrelated services are the right fit for a company depends on the specific cloud computing needs of the organization. Businesses should carefully evaluate each option to determine which cloud solution best meets their needs in terms of scalability, cost, and security.

Dymeng understands the nuance of managed infrastructure systems and how imperative it is to identify the right match for your company. We can work closely with you to identify the right software and systems to keep your business running smoothly.

Contact us today to schedule an appointment and learn more.