Monday, 19 May 2008

Benefits of Software as a Service (SaaS)


Over the last 18 months software as a service SaaS has become more prevalent with major software organisations such as Microsoft offering a rental model for the majority of their software applications which are hosted and managed on third party servers. Software as a Service (SaaS) is the term used for delivering software applications using the Internet or a wide area network as the delivery mechanism. SaaS can be implemented rapidly and removes the need to purchase expensive server infrastructure. The SaaS model is being used to provide a whole host of software applications from email to enterprise mobility solutions.

So what are the benefits ?

Revenue based payments

SaaS is delivered to organisations as a subscription model, usually billed on a per user per month basis for a fixed term of usually 3 years. Billing is on a “pay as you go” basis, that is, businesses only pay for the users who have benefited from the software during each billable month. Naturally this removes large upfront payments and potential annual licence, support and maintenance charges.

Third party hosted

Investing in expensive infrastructure is no longer required since SaaS software applications are now third party hosted. As a result there are no capital costs for hardware, licenses, databases or ongoing overheads of either third party or internal IT support staff or software and hardware maintenance and upgrades. Software applications are accessed via a web browser or a mobile device via a wireless network connection keeping your user IT requirements simple and low cost and easily managed.

Predictable costs

SaaS provides agreed pre-defined fixed charges. This enables you to project and predict your annual costs and helps with annual budget provisioning.

Multi-Tenant Efficiency

Some SaaS solutions use secure multi-tenant architecture (for example Microsoft Exchange email SaaS). This means that the cost of all software, infrastructure and expertise is shared by a large number of customers. This multi-tenant architecture offers reduced implementation times and economies of scale making the overall solution more cost effective

Increased Accessibility

Being Internet based, your applications are accessible not only in the office but from home a hotel room or from any of your businesses international locations if you have them.

Flexibility and Scalability

SaaS, provides businesses with a high level of flexibility. Since, the software solution is delivered via the Internet; SaaS completely eliminates installation and setup at the customer’s end. Users can be up and running very quickly. Also as your business grows all you need to do is request your service provider to add more users. Because hosted solutions are designed to scale, initially you could start with 10 users and after 1 month add say another 3,000 users without any issues, thus providing your business with ultimate flexibility.

Availability and Security

SaaS providers are in the business of providing uninterrupted reliable services. Vendors understand that data must be backed up religiously, and information security is a paramount concern. Skilled resources, network redundancies, stand-by power, up-to-date security and intrusion detection are a necessity in providing an enterprise class service.

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