What is SaaS?
SaaS is an acronym that stands for "Software as a Service." For decades, companies ran their software on their own infrastructure. Software as a Service is a new delivery model where companies pay not for owning the software itself but for using it. In the SaaS scenario, a software provider is responsible for its availability (installation, maintenance, scalability, disaster recovery, etc.)
As a term, SaaS is generally associated with business software and is typically thought of as a low-cost way for businesses to obtain the same benefits of commercially licensed, internally operated software without the associated complexity and high initial cost. Many types of software are well suited to the SaaS model, where customers may have little interest or capability in software deployment, but do have substantial computing needs. Application areas such as Customer Relations Management, Video Conferencing, Human Resources, Accounting and Email are just a few of the initial markets showing SaaS success. The distinction between SaaS and earlier applications delivered over the Internet is that SaaS solutions were developed specifically to leverage web technologies such as the browser, thereby making them web-native.
Key Characteristics of SaaS Software
- Activities managed from central locations rather than at each customer's site, enabling customers to access applications remotely via the Web
- Centralized feature updating, which obviates the need for downloadable patches and upgrades
- Application delivery typically closer to a one-to-many model (single instance, multi-tenant architecture) than to a one-to-one model, including architecture, pricing, partnering, and management characteristics
- Network-based access to, and management of, commercially available (i.e., not custom) software
SaaS applications are generally priced on a per-user basis, sometimes with a relatively small minimum number of users, and often with additional fees for extra bandwidth and storage. SaaS revenue streams to the vendor are therefore lower initially than traditional software license fees, but are also recurring, and therefore viewed as more predictable, much like maintenance fees for licensed software.
Why choose a SaaS solution?
SaaS is appropriate for any size business. Large companies love SaaS for its security, cost savings, and ability to scale as needs increase; smaller companies find SaaS to be the logical choice because of the flexibility of its pay-as-you-grow structure. SaaS is scalable and extensible; as an organization grows, so can its software solution. Organizations pay for what they use.
Maintaining a foothold in today's business climate demands instant response and 24/7 capabilities for action. This typical software model is no longer cost-efficient, secure, or manageable to respond to today’s requirements. Installed applications require client-controlled maintenance and user support and ongoing IT administration.
Quicker deployment with SaaS
SaaS offers dramatically decreased system implementation and deployment times. The client purchases an already developed software system that the vendor customizes for specific design and other functionality requirements, so there is no need to wait for initial development.
The software is available through a web browser, so no time is spent installing applications or training IT staff. On-premise solutions demand heavy, ongoing user support. With SaaS, user support is included in the subscription cost.
SaaS Offers Lower Costs
On-premise software requires perpetual licenses and maintenance fees as well as internal resources to manage equipment. ASPs (Application Service Providers, also referred to as managed hosting or generation-one hosted solutions) are more restrictive, resulting in a higher TCO than SaaS. All SaaS costs are included in an annual or monthly subscription.
SaaS typically requires less capital upfront and delivers considerable cost savings over time as maintenance and upgrades are included in the subscription fee. Costly, installed software requires more resources. The cost of installed, on-premise software applications doesn't end with the purchase of the license. Locally-hosted, on-premise software—applications maintained and housed on an organization's own servers—requires ongoing care and cost. While the initial outlay may be manageable, ongoing costs—such as scheduled maintenance, outage response, and end-user training—quickly balloon and eat into a company's budget.
Leave Maintenance and Upgrades to iHostdata
SaaS enables everyone—employees, customers, and more—to log in to the system from anywhere, 24x7x365. Our customers have access to updates and new releases as part of their service package. iHostData is responsible for all maintenance and upgrades so you always have access to the most up-to-date technologies without any of the headaches or costs.
The cost of installed, on-premise software applications doesn't end with the purchase of the license. Locally-hosted, on-premise software—applications maintained and housed on an organization's own servers—requires ongoing care and cost. While the initial outlay may be manageable, ongoing costs—such as scheduled maintenance, outage response, and end-user training—quickly balloon and eat into a company's budget.
Maintaining a foothold in today's business climate demands instant response and 24/7 capabilities for action. This typical software model is no longer cost-efficient, secure, or manageable to respond to today’s requirements. Installed applications require client-controlled maintenance and user support and ongoing IT administration.
Learn more about SaaS at Wikipedia.
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