Single-Tenant vs. Multi-Tenant: Which SaaS Architecture is better for Your Business?

Single-tenant and multi-tenant cloud architectures represent two core approaches to managing SaaS environments, each with unique benefits depending on how resources and infrastructure are utilized. In a single-tenant cloud, each customer has their own dedicated environment, offering greater control, data security, and customization. Meanwhile, multi-tenant cloud architecture allows multiple customers to share the same infrastructure, driving down costs and enabling faster, more frequent updates. Hence, choosing the right cloud architecture is crucial for your business.

This article comprehensively compares SaaS-based multi-tenant and single-tenant cloud architectures along with their benefits and drawbacks. The comprehension also points out which one to choose based on the organization’s requirements and scenario.

Single-Tenant Cloud Architecture

A single-tenant architecture dedicates a single instance of the software, infrastructure, or database to a single customer. The single-tenant system encapsulates all customer data and interactions distinctly from other customers. Moreover, customer information is not shared in any way.

In a single-tenant architecture, the provider helps manage the software instance and dedicated infrastructure while giving a single-tenant nearly complete flexibility over software and infrastructure modification. Single-tenancy models provide control, reliability, security, and backup capability. In addition, each tenant has its independent database and software instance, keeping them separate from one another. Each tenant's data also has a remote backup, allowing tenants to restore their data in case of data loss quickly. In most cases, tenants can choose when they want to install any available updates themselves rather than waiting for the service provider to do so.

Ultimately, potential customers who desire more control and flexibility to meet specific needs in their environment would likely prefer a single-tenant infrastructure over other solutions.

Benefits of Single-Tenancy

Although single-tenancy architecture is uncommon, it caters to easy auditing and maintenance. Here is the list of some other benefits a single-tenant cloud provides:

• Excellent Reliability: Single-tenant architectures are typically more reliable because one software instance serves one customer. So the entire system remains unaffected by other cloud traffic and peak load performance. Also, it becomes easier to scale as compared to the multi-tenant. Moreover, one can configure In-transit Network Routing in single-tenancy.
• Enhanced Data Security: Single-tenant cloud architecture separates application instances and supporting components like database and infrastructure for each customer within the same provider. So, there is no way for others outside of your organization to access your data in case of vulnerability. As a result, even if a customer with the same service provider experiences a data breach, other tenants remain protected.
• Simplified Migration: It is easier to migrate data from a single-tenant architecture since the data store contains data from a single customer. One does not need to think about mixing customer data or using complicated migration scripts.
• Easy Customizations: In the case of SaaS, mainly the services are thoroughly managed by the service provider’s team. However, the service provider can give dedicated server access to customers in the case of single-tenant—for example; server logs access to customers. The same level of ownership or customization cannot be provided for multi-tenant customers.

Drawbacks of Single-Tenancy

Despite all of the potential benefits of single-tenancy, it is still the least popular architecture among competing options, which you could attribute to some of its drawbacks. The following are some of the disadvantages of single-tenancy:

• Higher Costs: Hosting one SaaS instance per customer increases the cost due to setup time, resources, customization, and maintenance.
• Lesser Deployments: While releasing customer-specific updates and features, all customer benefits in case of multi-tenant. Such feature updates are not generally released for single-tenant customers because of their separate application instances and related components.

Single-Tenant or Multi-Tenant SaaS: Which is Better for Your Business

Multi-Tenant Cloud Architecture

Multi-tenancy is another cloud architecture wherein a single instance of a software program serves numerous customers. People usually refer to the real estate analogy to explain Single-tenant vs. Multi-tenant cloud architecture.

Every user in a single-tenant cloud lives alone in a single building with its security system and amenities, entirely secluded from neighboring buildings. Tenants in multi-tenant cloud architecture, on the other hand, live in various apartments within a single apartment complex. They are both protected by the same security system and have access to the same communal facilities. However, each resident has a key to their apartment, ensuring that their privacy is protected. The actions of other tenants, however, are more likely to affect their comfort in the property.

Most startups choose a multi-tenant architecture having a single massive database containing all customer information. Customer data is kept confidential with the necessary security systems in place. While customers cannot view each other's data, they are all stored in the same database, and all of the data gets processed by the same computer.

Benefits of Multi-Tenancy

• Lower Costs: SaaS allows businesses of all sizes to share infrastructure and data center operations expenditures, resulting in lower prices. It also reduces infrastructure implications as compared to single-tenancy-hosted solutions.
• Frequent Deployments: All customers get the feature updates when SaaS vendors release features in a multi-tenancy environment, even if a specific multi-tenancy customer initially requested the feature.

In contrast, the single-tenancy customer does not benefit from such scenarios.

Drawbacks of Multi-Tenancy

While multi-tenant cloud architecture is usually the best option for most SaaS customers, it can have some drawbacks, including:

• Greater Security Risk: As different customers share resources, the risk factor in a multi-tenant setup increases. In contrast to a single-tenant cloud, where security events remain isolated to a single customer, it is more likely to harm other customers if one customer's data is compromised.

  In multi-tenancy, an organization's data is not visible to other tenants. However, multiple users without the organization's affiliation get access to the same database. This increases the security risks.

• Resource Availability: The increased load of one customer can impact other customers sharing the same resources in a multi-tenancy setup. While in a single-tenancy architecture of SaaS, this risk is not present as customers are provided with dedicated resources.

When to Use One Over the Other

A single-tenant setup of SaaS may be appropriate for certain companies or sectors where customer data privacy and security are paramount. The healthcare and finance industries are excellent examples, leveraging single-tenant cloud systems.

For example, when working with patient information, applications in the healthcare industry must comply with HIPAA regulations. To maintain compliance, each hospital may need to establish its own data center on-site. The same is true for certain forms of financial information.

Most consumer-facing applications and start-ups that require comparatively less customizability tend to use a multi-tenant setup of SaaS. Also, multi-tenancy is preferred by organizations that want to opt for a cost-effective solution.

To learn more about Single-Tenant vs Multi-Tenant Cloud, check out the infographic by LoginRadius.

Conclusion

There are a lot of other factors an organization must keep in mind while deciding which SaaS architecture to choose. Some business factors are the purpose of cloud adoption, type of application, budget, scalability, customization, migration, visibility, backup, and recovery. Finally, organizations must brainstorm what they want to achieve and how their company operates to arrive at the best, ideal solution.

Frequently Asked Questions (FAQs)

1. What is the difference between single tenant vs multi tenant?

In single tenant architecture, a dedicated cloud infrastructure serves one client, while in a multi tenant cloud, multiple businesses share the same infrastructure, which optimizes resources.

2. Is AWS a single tenant?

AWS offers primarily multi tenant cloud environments, but single tenant architecture can be achieved through dedicated hosting options like Amazon EC2 Dedicated Instances.

3. What is a multi tenant cloud system?

A multi tenant cloud system allows multiple businesses to share the same infrastructure, with resources and applications managed centrally for efficiency.

4. What are some examples of single tenant and multi tenant systems?

Private clouds or custom SaaS deployments are examples of single tenant architecture, while platforms like Salesforce represent multi tenant cloud systems.

5. Which SaaS architecture is more secure: single tenant or multi tenant?

Single tenant architectures generally offer more security due to isolated data environments, while multi-tenant systems have more shared risks but are often well-protected by cloud providers.

6. What is tenancy in cloud computing?

Tenancy in cloud computing refers to how computing resources are shared—whether through single tenant or multi tenant systems that isolate or combine client resources.

7. What is a tenant in cloud computing?

A tenant in cloud computing is an entity, such as a business, that uses a specific cloud infrastructure, either in a single tenant or multi tenant setup.

LoginRadius provides both single-tenant and multi-tenant SaaS architecture for our CIAM solution.