What is SaaS (software as a service)?
Software as a Service (Saas) is a cloud-based software sharing model where a cloud provider develops and maintains cloud applications and shares them via the internet on a pay-as-you-go basis. The SaaS model is defined by cloud-based infrastructure, remote web access, and monthly subscriptions as their primary pricing model. SaaS customers can significantly reduce operating costs, deploy, scale, and upgrade business solutions faster than maintaining systems and software locally and predict TCO more accurately.
The SaaS model plays a vital role in enterprise-level technology across all business verticals and continues to grow in popularity among key decision-makers. Saas models are most often used in online finances, mobile-first commerce, e-banking, online stores, and business support.
The popularity of SaaS solutions continues to grow as internet speed is now fast enough to handle even advanced programs. Its growth is also driven by SMEs that stopped buying overpriced, monolithic software.
What are the benefits of the SaaS model?
- Lower initial costs – by purchasing SaaS software, businesses can minimize the cost of additional hardware and middleware, reducing the installation time and implementation costs.
- Predictable expenses – most SaaS businesses follow a ‘pay-as-you-go’ model with a monthly subscription, which makes the estimation of costs much easier. Also, the SaaS model means no more problems with unpredictable software and hardware management, patch installations, or upgrade costs.
- Rapid deployments – SaaS clients are fully ready to change in hours instead of months. They also get access to the latest improvements and updates with automatic software patch installations.
- Scalability – with SaaS, companies can quickly meet growing data or transaction processing needs, reducing downtime while maintaining a high level of service.
- Accessibility – SaaS lets businesses access the software via any frontend interface, without installing the application on a local machine. This means that the application should be accessible anywhere and at any time, making the service more responsive and adaptable.
- Customizability – SaaS platforms offer greater customizability because they're hosted, updated, and accessed through the cloud. SaaS users may tailor the platform to individual needs, connect third-party tools and build additional features on top of system foundations.