Software as a Service

What is Software-as-a-Service (SaaS)
SaaS is one of the most compelling and challenging IT and business innovations of the past two decades*. IDC predicts the Software-as-a-Service (SaaS) market will experience a 21 percent compound annual growth rate during the next three years, reaching US$10.7 billion worldwide by 2009.

SaaS providers host the application and data centrally and maintain the integrity of the product from a security and upgrade point of view so the end user does not have to worry about it. Vendors offering SaaS based products provide access to their products over the Internet.

Clients pay an annual subscription to access the products based on typical user metrics, normally x number of users or access to x number of licences. The client effectively leases the software and never ends up owning any software assets (apart from the under lying data and Intellectual Capital associated with the data they create).

This makes is very cost effective for both large and small companies alike to gain economically viable access to complex technology that was traditionally either hard to deploy, out of their price bracket or too resource hungry to deploy on large scale projects. Access to SaaS products is nominally 365x24x7 and because it is deployed securely over the internet it is scalable on a global basis.

Benefits of this approach
The key benefits of SaaS based access and deployment of software products is highlighted in the diagram below that contrasts SaaS with traditional software deployment and access methods.

* Bill McNee, Saugatuck Technology Report - May 2006