Consider the case of an enterprise with its set of software licenses for the various applications it uses. These applications could be in human resources, finance, or customer relationship management, to name a few. Instead of obtaining desktop and server licenses for software products it uses, an enterprise can obtain the same functions through a hosted service from a provider through a network connection. The interface to the software is usually through a web browser. This common cloud computing model is known as Software as a Service (SaaS) or a hosted software model; the provider is known as the SaaS provider.
SaaS saves the complexity of software installation, maintenance, upgrades, and patches (for example, for security fixes) for the IT team within the enterprise, because the software is now managed centrally at the SaaS provider’s facilities. Also, the SaaS provider can provide this service to multiple customers and enterprises, resulting in a multitenant model. The pricing of such a SaaS service is typically on a per-user basis for a fixed bandwidth and storage. Monitoring application-delivery performance is the responsibility of the SaaS provider. Salesforce.com is an example of a SaaS provider. The company was founded to provide hosted software services, unlike some of the software vendors that have hosted versions of their conventional offerings.
SaaS offers many benefits to the enterprise. The benefits include
Lower cost: SaaS usually operates on a monthly subscription basis, and customers don’t have to pay the license fees up front, resulting in lower initial costs. Also, SaaS providers maintain the infrastructure that removes the CAPEX expenditure for hardware and software.
Quick deployment: In traditional networks, customers need to deploy the hardware and software solutions. SaaS solutions don’t require any software to be installed or purchased to use SaaS services. Also, the hardware is managed by the SaaS provider. With SaaS solutions, only a web browser and Internet access are needed to get started.
Easier upgrades: SaaS providers upgrade software solutions regularly and make them available to customers. Customers don’t need to buy the upgrade package by paying an additional cost as in traditional software deployment.
Scalability: SaaS providers provide flexible subscription options where customers can provide access to more users to the infrastructure as the business grows.
Time savings: With SaaS solutions, software is already deployed in the cloud.
Customers can directly start using the service, whereas in traditional networks customers need to deploy each software solution separately and integrate them, which may take weeks or even months to deploy.
