Saturation effects in deep inelastic scattering at lowQ2and its implications on diffraction

We present a model based on the concept of saturation for small $Q^2$ and small $x.\mathrm{}$ With only three parameters we achieve a good description of all deep inelastic scattering data below $x=\mathrm{0.01.}\mathrm{}$ This includes a consistent treatment of charm and a successful extrapolation into the photoproduction regime. The same model leads to a roughly constant ratio of diffractive and inclusive cross section.