What is SaaS?

SaaS, also known as software as a service, is a software implementation model in which a software provider offers an application in the form of a license for consumers to utilize as an on-demand service. The software providers may offer their application in a number of different ways.

Some may host it on servers they control, or they may allow the application to be downloaded onto the device of the consumer, disabling it once the contract has expired. The functionality for the on-demand features may be handled in an internal manner, but they may also be handled by a third party who is referred to as being the ASP, or application service provider.

The ASP will generally be responsible for the sharing of licenses among multiple firms. One of the best contemporary examples of a SaaS provider is Google Apps. They provide standard applications for business over the Internet, which may be accessed via the web browser, and the data and software will typically be stored within the servers.

There are a number of reasons why on-demand licensing is becoming more popular. First, it gets rid of the need for the consumer to connect the device to multiple applications. It also eliminates the EULA, or End User License Agreement in terms of maintaining the software, was well as dealing with ongoing patches.

The issues of patches can cause complexities within an organization, and on-demand licensing is a tool which allows the software to become a type of expense which is verifiable, as opposed to being a cost which is fixed when the application is purchased.

It also allows for licensing only with the total amount of software which is necessary when compared to more standard forms of licensing. SaaS allows the buyer to share their licenses with multiple departments within their organization, and with other organizations. This means that the price for getting EULAs for each device in the organization can be dramatically reduced. It has been shown that SaaS also reduces the investment that is needed for servers.

SaaS Background

The concept for SaaS started in 1999, and was mentioned in a technical document from 2000 called "Strategic Backgrounder: Software as a Service. It was around this time that the term started being used commonly. One reason why SaaS has become popular is because it has lowered the price of running a business.

The business can get the licenses which are necessary to run an application they need, but they can do so for a very competitive price. In the past, high start up costs combined with high software complexity made getting licenses a costly head ache for many. The good news about SaaS is that practically all software can work with this model.

The vast majority of Unix based applications already have compatibility with SaaS, but many applications which are EULA based didn’t have this functionality prior to the introduction of SaaS. For instance, once a word processor was purchased and licensed, it had to remain on the computer that it was initially installed on.

The problem with this structure is that when the employee decides to take their work home with them, they won’t be able to use the word processor unless than install it and pay for a new license on their home computer. This means that in the past companies had to either pay more or suffer a loss in their speed and efficiency.

Remote Administration Versus SaaS

One tool that was introduced to get around this problem was Remote Administration. It attempts to bypass this problem through the sharing of the CPU controls as opposed to using on-demand licensing. The problem with remote administration is that the host computer that has the license must be left on and there are security issues that arise when it comes to the sharing of the CPU controls.

SaaS is superior to remote administration because it allows for licensing on-demand while handling both the information and output simultaneously, which means the location of the hardware is not important. SaaS is distinct from older Internet based applications because they were created to leverage online technologies like the browser, making programs better for the web.