What is the difference between an ESB and an iPaaS?

For the longest time, integration has been considered one of the biggest challenges for utilities. Utilities need integration to “become digital” and connect their data, systems and devices as well as ensuring a connected, collaborative enterprise and customer experience. ESB (Enterprise Service Bus) and iPaaS (Integration Platform as a Service) play a similar kinds of role; they integrate enterprise applications and systems. But, there are certain differences.

In this post, we highlight some of the main differences and explore situations where using either ESB or iPaaS would be more appropriate.

On-premise vs. Cloud Integration

• An ESB is typically operated on premise and implemented as an integration architecture approach to solve application integration with local or legacy systems.
• An iPaaS typically runs in the cloud and is designed to mainly handle integrations between various cloud services and SaaS solutions. Most (Enterprise grade) iPaaS solutions support hybrid integration scenarios to bridge the gap between on-premise solution and cloud applications.

Platform Operations vs. Managed Services

• An ESB (and the infrastructure it is running on) must be operated, monitored and managed by the organization itself. This requires resources, and time for education and training to operate and manage the ESB platform. In addition you will need time to establish a "DevOps" team and operational processes.
• An iPaaS is offered as a managed service by the iPaaS solution provider. You will not need any additional resources to operate or manage the platform. Think about it as a "NoOps" platform.

Vertical Scaling vs. Elastic Scalability

• An ESB typically scales vertically (meaning the addition of more resources) and to some extent horizontally (meaning the addition of more machines / nodes). Since an ESB is operated on-premise and the architecture is often quite complex, you will spend considerable effort and additional resources to scale.
• An iPaaS typically scales horizontally and more importantly an iPaaS scales elastically. This means that the iPaaS scales dynamically and automatically up and down depending on the required compute resources.

Application Integration vs. API (First) Integration

• An ESB provides many different connectors to integrate with either different integration standards and protocols (i.e. SOAP, REST, JMS, JDBC, etc.) or application connectors (i.e. SAP).
• An iPaaS typically provides these types of connectivity services too. More importantly, an iPaaS incorporates API Management capabilities and fosters an API First design and integration principle that creates high(er) flexibility and agility in a fast-moving digital world.

Waterfall Project Delivery vs. Agile Service Delivery

• An ESB is operated on-premise, often has a complex architecture and is typically implemented by an IT department or by external consultants. As an ESB is infrastructure- and resource-greedy, an integration project leveraging an ESB typically follows a lengthy waterfall delivery model.
• An iPaaS is provided as a service, with a lighter-weight architecture and often offers (web-based) low-code modeling/ development features that empower an agile (but not fragile) delivery model.

In addition to these main differences, there are several more. These include the differences between iPaaS lightweight microservices architecture vs. an ESB complex MOM (messaging oriented middleware) approach and comparing iPaaS real-time processing and streaming capabilities vs. ESB stateless pass-through messaging pattern.

Based on our experience, we offer some tips and guidelines for when to prioritize an (Enterprise) iPaaS:

• When you are you running a digitization project or digital transformation that is a high priority for your organization, then use an iPaaS. In a fast-moving digital world, you will be required to provide "integrated" services based on real-time data to your users or consumers.
• When operating a hybrid integration landscape with both cloud services and local applications, use an iPaaS. You must bridge the gap between on-premise and cloud and with an ESB you will run into difficulties.
• When you are running an IoT or big data project, then use an iPaaS.
  You will need dynamic and elastic scalability to handle big data loads and you must "design for uncertainty".
• When you are short on operational resources or you want to foster agile delivery of services, use an iPaaS. Instead of "wasting" resources on operating and maintaining a platform, use your resources to deliver new value-added services.