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I would say that S3 is NOT SaaS, and would call it Hardware as a Service (HaaS), since it is primarily offering up disks on demand. Admittedly there is software there, but it is primarily focused on getting bits on and off disk.
I disagree with your characterization that SaaS is just apps. Take the term literally, and something like Amazon SQS is a SaaS offering. It offers a software solution (queuing) as a service offering (pay as you go, delivered by a 3rd party, etc).
BTW - I did a blog post last week about the "aaS" terms and offered a visual map to organize them:
http://peterlaird.blogspot.com/2008/05/saas-sou...
I also did a blog posting with an industry map a few weeks prior that shows how I place the vendors into the buckets.
This is a very thoughtful analysis and very topical (of course). I too, as the Technology Evangelist for GoGrid (http://www.gogrid.com), have been struggling to categorize the various cloud offerings in a way that people who are not completely tapped into the industry can (hopefully) understand. I've been calling it the "Cloud Pyramid" for lack of a better term, which has the categories as: Cloud Applications (e.g., SalesForce), Cloud Platforms (e.g., Google App Engine) and Cloud Infrastructure (e.g., EC2 and GoGrid). Details are here.
But I like your term Cloud Services and I'm trying to figure out if they would span the categories that I have described or simply be sub-sections within the Infrastructure Cloud (or even the Platform Cloud). Obviously this whole environment is in its infancy, in terms of market adoption, but the uptake is incredibly quick it seems.
I look forward to reading more of your insightful posts.
Thanks,
Michael
@Peter:
I think that's part of the problem. We want familiar buckets to put everything in, especially as engineers defining this field, but it's not there yet. It's not ready for buckets, and it limits the mindset on what a CIO, Engineer, or average Joe can expect from these things.
It's pointless to append 'aaS' if you have to reduce it to such a general term as 'hardware' or 'people' and adds no clarity to what you are looking for, or what you mean when you say something. If you were to say 'we run entirely on HaaS', how much different is that to saying 'we run entirely on SaaS'.
I feel it's overloading new technologies with terms intended for entirely different purposes. If you look at both of your graphs, they put the 'app' services on one side, and the 'cloud' on the other -- with the only connection being the broken terms.
As a more concrete analogy, it's rarely necessairy, if ever, to be talking about front-end, user facing apps in terms of the APIs running them, except to engineers looking to extend an existing platform. I am hard pressed to think of a time I would be writing article about 'Using Firefox' and 'Using the Gecko API' that would have any coherence.
These are just my opinions, and I see the desire to tie the similarities together. After all, libraries (APIs) are software. The kernel is software. The access to your hardware is (largely) software, however, SaaS is more like 'Applications as a Service', overloading the term Software.
Anyway, enough ranting. :)