Software As a Service (SaaS) – A New Product Delivery System

18 Mar. 2011 Software Development

Software as a Service (SaaS), also known as software on demand, is a software service that is accessed over the internet or is deployed to work behind a firewall on the local area network. With Software as a Service, a company licenses an application to clients as a service on demand, using a subscription pay model either by pay-as-you-go or at no charge, if there is an opportunity of getting revenue from other steams beside the user, such as through adverts etc. This application delivery model is part of the cloud computing business model where technology is in the cloud and accessed using the Internet.

Software as a Service is increasingly becoming the prevalent delivery model for services as the underlying technologies that support service-oriented architecture and web services matures. And also the popularity of new development approaches like Ajax have tremendously aided its growth. The ease of access to mobile broadband service have also supported user access to cloud computing services from anywhere in the world.

The conventional model of software distribution, where software is purchased and installed on personal computers is sometimes referred to as software as a product. The software as a service model has become a very common business application model which includes Accounting, Customer Relationship Management (CRM), Collaboration, Logistics & Supply chain, Enterprise resource planning (ERP), Human Resource Management (HRM), and Content Management System (Enterprise CMS).

Software as a Service has a lot of obvious benefits for the modern day business, which are as follows:

  • It is accessible from anywhere in the world with an internet service
  • There is no local server installation
  • It reduces time to market
  • It increases reliability of service
  • It encourages pay per use or subscription based payment system
  • It has easier administration
  • Easy automatic updates and patch management
  • Encourages compatibility, all users will have the same version of software.

Software as a Service is great for a startup company that aims to test before going full scale into their business or that wishes to start operating modestly. Besides, it is highly scalable which means that it has capacity to expand as the business grows. Since all aspects of the software as a service is left to the SaaS provider, a startup business owner will be able to focus more on growing his business instead of worrying about his IT infrastructures.

Companies have discovered that SaaS services are a more cost efficient way of using business software . And also to use them as when needed rather than licensing every application on every device. A properly priced software licenses and a well-designed implementation will deliver license cost benefits without the attendant complexity and the often high cost to equip all business devices with applications they possibly may not need.

Software as a Service is growing in demand by companies because of a lot of benefits to the modern business. The easy access to broadband internet and the prohibitive price of legacy software is forcing companies today to look at cloud computing for a better choice. Saas has a great future in the business world because more and more companies are adopting it, and many software vendors are also choosing it as a product delivery method.

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