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Cloud-Hosted vs Cloud-Native Applications: What's the Difference?`

Learn the complete difference between cloud-hosted vs cloud-native applications across various metrics such as architecture, cloud costs, scalability etc. 

Priyanka Shaw11 Sept 20269 min read
Cloud & AWS

Hey there, dear readers! Today, I will be discussing the key differences between cloud-hosted vs cloud-native applications. Cloud technology has altered the way organizations build, deploy, and manage applications. Organizations no longer have to rely solely on physical servers and traditional data centers; they can use a cloud environment to host the software for application deployment.

However, this does not mean that an application can automatically be classified as cloud-native just because it has been moved to the cloud. Many people are confused at this point when planning a cloud migration or application modernization project.

A cloud-hosted application is an old application that has simply been transferred to the cloud environment from its on-premises infrastructure. A cloud-native application, however, is created to utilize cloud features to their full advantage, including elasticity of capacity, containers, microservices, automation, managed services and continuous delivery.

The importance of the difference between cloud-hosted and cloud-native applications lies in the fact that the architecture selected will determine such characteristics of the application as scalability, performance, security, complexity of operations, speed of development and costs associated with cloud services both now and in the future.

What Is a Cloud-Hosted Application?

A cloud application implies an application that runs on cloud services rather than running on a company’s own servers or traditional data center. Many times, the application was initially designed for on-premises use.

Thus, the application, together with its database and other necessary components, becomes the cloud environment by moving to the cloud platform provided infrastructure. As an illustration, a company had a regular application running on physical machines; mentioning the application with the intention to avoid any redesign efforts, the company may move existing applications and databases workloads to the cloud-based environment, for instance, to Amazon EC2.

Even though the application may start working in the cloud environment, the initial architecture remains unchanged. This approach is often referred to as the lift and shift migration drift. It is appealing since businesses can move quickly without major redesigns.

Cloud technologies provide some advantages, allowing an organization to reduce hardware dependence, gain flexibility in its infrastructure, access cloud-based backup, and provision computing resources easily.

What Is a Cloud-Native Application?

The term "cloud-native application" refers to an application that can be created and deployed only in a hosted cloud environment. While traditional applications could be hosted on different cloud systems and physical servers, cloud-native application development revolves around the idea of utilizing the cloud's infrastructure and services in its technology stack. The technologies that are widely used in cloud-native applications include containers, microservices, application programming interface, orchestration tools, infrastructure as a code, automated continuous integration and continuous development pipelines, managed databases, serverless computing, as well as observability tools. The main goal of cloud-native application development is to design the application architecture that would be able to respond quickly to the varying workloads rather than simply running the code on cloud computing servers. For example, a cloud-based e-commerce application can incorporate customer management, product catalog, payment processing, ordering, and notification deployments as independent services that could be changed and scaled according to individual needs.

Cloud-Hosted vs Cloud-Native Applications

One can comprehend the distinction best by looking at how applications utilize the cloud.

Consequently, a cloud-hosted application operates in the cloud, while cloud-native application is designed to be based in the cloud.

Take, for instance, a regular enterprise application working on a virtual machine. Transferring the virtual machine from the company’s data center to a cloud provider makes it cloud-hosted, even if the application still requires a standard configuration and deployment of the application.

On the contrary, a cloud-native application can operate using containers and managed computing services, scale automatically, utilize managed databases, be integrated into cloud-native messaging infrastructure and deployed using an automated CI/CD process.

Hence, the difference between cloud-hosted and cloud-native applications is more architectural than geographical.

Architecture Differences

Architecture is one of the main distinctions between the two models. Cloud-hosted apps typically use the same architecture. These can involve monolithic application structure, virtual machines, standard databases, manually configured infrastructure, and tightly coupled components.

Such architecture may provide the best efficiency when the application is able to predict workloads quite well. However, it may be complicated to scale some elements of the application because, in most cases, if one of the elements needs to be scaled, the entire application has to be scaled as well.

When it comes to cloud-native applications, they are constructed focusing on modules and independent components. Microservices are often the way to go, but being cloud-native itself does not mean that the use of microservices is necessary in each case.

A cloud-native solution can involve containers, APIs, serverless functions, managed database, queues, event-driven services, etc.

This gives companies an opportunity to choose the most appropriate technology for each task instead of limiting the whole application to a certain type of infrastructure.

Scalability: Cloud-Hosted vs Cloud-Native

Another crucial distinction is scalability. The cloud-hosted application indeed has the capability to scale. For instance, an organization may increase the CPU or memory or the number of virtual machines running the application.

Although it is still likely to remain mainly infrastructure-centric. For instance, if a business application sees an increase in traffic during some point in time, the organization might need to deploy more virtual machines or increase the capacity of the existing instances. Depending on the architecture this may require manual action or well-configured infrastructure rules.

Cloud-native applications are usually made for more flexible scaling.

Different parts of the application can scale differently according to demand. For example, while one service processing payments may require additional resources, another component can remain at the lower level of demand. Cloud computing technologies can allow such flexible scaling to be done automatically.

Performance Considerations

By giving access to modern infrastructure, caching services, load balancing, and high-speed storage, cloud hosting may improve performance. Nevertheless, performance characteristics of cloud-hosted applications are still influenced by the application design itself. A legacy application can have poorly constructed database queries, tightly-related components, synchronous processes, or some infrastructures causing poor performance regardless of its location. Cloud-native applications are usually built with the idea of distributed cloud infrastructure. Therefore, the advent of caching, asynchronous processing, event-driven architecture, managed databases, content delivery networks, and independent scalability are used for better performance of applications. Yet, it does not mean that every cloud-native application performs better. It is possible to have poorly-designed distributed systems that only create delays and communication overload.

Deployment and DevOps

It is possible for deployment procedures to be quite different. Conventional procedures are utilized for cloud apps. The software developer may compile the release package and copy it onto the server, suspend or restart parts of the application, and perform the deployment checks manually. Although many of the cloud applications later adopt automatization, the fundamental scheme of the application is still classic. Meanwhile, cloud-native development is associated with automatization for the entire lifespan of software applications. CI/CD technology helps automate several processes, including building, testing, scanning, and deployment of the software application. Also, it enables the definition of infrastructure via code, hence increasing the ease of maintenance and replicability of the environments.

Security Differences

It’s very significant to provide security for both cloud-hosted and cloud-native applications. Cloud-hosted environments can apply security tools pertaining to the cloud such as identity and access management, encryption, segmentation, security monitoring, vulnerability management, and logging.

However, companies have to provide security on the application level and configure underlying infrastructure properly. Cloud-native environments involve additional security issues, as there are containers, APIs, serverless functions, orchestration platforms, identities, secrets, infrastructure-as-code files, and numerous interlinked services.

Security should be introduced into the process of development at various stages. Company security may include automated assessment, dependency watching, scanning of images, identity controls, secrets management, monitoring, and testing.

Cloud-native security is not easier than other types of security, but it requires companies to work according to the security rules appropriate to the latest conditions.

Cloud Costs

One area where this understanding is critical is in the cost of the application. A cloud-based application may be easier to assess in terms of cost due to its similarities to the traditional server-based environment. Companies usually know how many virtual machines, storage space, and databases they use.

Nevertheless, the resources might remain active even when they are not in huge demand. Thanks to autoscaling, serverless computing, managed services, and specific infrastructural services, a cloud-native application is capable of improving its resource management.

At the same time, cloud-native architecture might add more services and components, which might lead to higher financial costs if not developed properly and controlled. Thus, the fact that something is cloud-native does not mean that it is economical.

Companies should monitor their resource usage, data transfer and storage, service consumption, as well as application-based workflows. FinOps approaches will help teams from technical and financial departments to understand how their architectural decisions affect cloud expenses.

Cloud-Hosted vs Cloud-Native: Which Is Better?

There is no universal winner. Cloud-hosted applications can be practical, cost-effective, and reliable when the application does not require extensive modernization. For many organizations, migrating an existing workload to the cloud is an important first step toward reducing infrastructure dependency. 

Cloud-native applications provide greater opportunities for automation, elasticity, independent deployment, and modern application operations. They are especially valuable for organizations building digital products that need to evolve rapidly.

The right decision depends on application complexity, business requirements, expected growth, existing technical debt, development capabilities, security requirements, and budget.

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