Software-as-a-Service (SaaS)


The traditional method of using computer software involves purchasing the software, installing it onto your personal computer (PC), and running it on your PC.  Similarly – in business environments – network-based software (which needs to be accessed simultaneously by a greater number of people), would be installed to a central network server (computer) owned, operated and housed by your company.

Software-as-a-Service (SaaS“Software-as-a-Service” – abbreviated to “SaaS” for short, is a new way of using software which dispenses with this old methodology.   Instead of buying a copy of the software, installing and running it on your PC, SaaS allows you to rent access to – and use of – the software.  The software isn’t installed on your PC – instead it is installed and runs on computers operated by the software supplier, and you access that software via your PC and your Internet connection as and when you need it.

Today, more and more software developers are offering or enabling their software to be delivered to customers via the SaaS method, so strong are its benefits for both business and residential software consumers.


There are some compelling advantages for both software users and software suppliers, who adopt the SaaS model of accessing and running software.  These advantages are just as compelling for business consumers of software.

  • Direct and Indirect Costs of using the software

The traditional method of using software involves a large initial payment for purchasing the software and your rights to use it.  It is then up to you to provide sufficient computer hardware resources to run that software.  You’ll also have the take responsibility for administering and managing that software, which may require specialist expertise or certainly a lot of time, effort and ultimately – expense.

With SaaS, you’re buying the software-as-a-service, so all the administration, management, backup and operating resources for that software is provided by your supplier.  Hooray!   Furthermore – since access to the software is now rented to you – there’s little or no initial payment.  In the majority of cases you can buy SaaS on a comparatively modest monthly payment.

  • Reliability

The traditional method of installing software to your PC or network server relies on the stability of that computer.  If that computer stops working, then you can’t use that software – and (subject to your backup policy) you’re likely to lose a significant proportion of your data.  The traditional method of using software therefore carries a high risk service interruption and data loss.

With SaaS, your supplier selects and builds the optimal computer platform upon which to run the software.  As such he will invest substantially in computing and engineering resources in order to ensure he can deliver an optimal software experience to his users every time.  The supplier will build his computer platform in a Datacentre which provides highly reliable and resilient hosting environment for his powerful servers.  He’ll create a highly resilient architecture within which his software will operate – and this will include multiple points of redundancy and comprehensive backup strategy.  The end result is that your SaaS introduces a far greater level of reliability for your use of that software.

  • Future-Proofing

Moving to the latest version of particular software would traditionally require further capital expenditure and the arduous task of administering the upgrade on your computer or network server.

With SaaS, keeping up-to-date with the latest and greatest software versions is much simpler.  Since you’re buying the software “as a service”, and the software exists only on your supplier’s computer infrastructure – its up to him to administer the upgrade within the scope of the service he’s providing you.  And since he’s technically best adept to the task, for the user, transitions to new versions should be seamless and painless – both financially and operationally.

  • Contractual Freedom

The traditional way of using software may – or may not – come with support contract obligations.  Either way, you are buying use of the software up-front or financing its procurement over a fixed inflexible period.

With SaaS, you’re renting access to the software – and since it is hosted by the SaaS supplier its comparatively easy to switch-on and switch-off users.  What this means is that SaaS lends itself ideally to the “on-demand” model of consumption.  Many SaaS suppliers will offer very flexible usage contracts – even month by month, day by day or in some cases minute by minute!

  • Scalability

Traditionally, adding new users of software would require procurement of new licenses, new pieces of software, and designation of technical staff to help your new user “get set up”.  This can be costly and time-consuming.

With SaaS, the software is all operated centrally by your SaaS supplier who has invested heavily in a sophisticated, scalable and reliable computing platform.  As such, if you need to add (or remove) a user, a quick instruction to your supplier will result in almost instantaneous adjustment to your service.  SaaS gives your company the ability to scale up or down on-demand, allowing you to focus on your business!

  • Accessibility

With a traditional software installation, your software resides on your computer or network server.  The chances are that it won’t be with you when you’re travelling, at home or generally away from the office.

SaaS offers much higher levels of accessibility.  Since the software doesn’t sit on your computer, and instead sits your provider’s datacentre – so long as you have a computer and internet access, you’re more than likely to be able to access your software!  This includes accessing your software via a wide range of computers, different operating systems, tablets smartphones etc. wherever you are in the world.  Such flexibility of access can help your staff be more responsive and productive.


As with all new technologies, there are things to keep in mind and take into consideration.  Here are a couple of the main things to consider when looking at SaaS as a solution to your software usage.

  • Internet Access

SaaS is delivered over the Internet, or perhaps in some cases over your wide area network connection.  In either case you need to ensure that your connection to the service is sufficiently stable, reliable and offers sufficient bandwidth for your business users to operate.  If Internet access isn’t reliable or is constrained in the amount of bandwidth you have access to – then SaaS may not be the right solution for you.  However in many cases SaaS can easily cost justify an upgrade to your network connections.

  • Data Security

SaaS resides at the provider’s datacentre facilities, so by default your data will also reside there in whole or in part.  If you business is governed by compliance and regulations then it may be important to check exactly when your provider’s computing facilities, file storage and backup facilities are.  It’s the same as outsourcing any service – you need to do your due diligence on your supplier such that they comply with your business policies.

  • Performance

Since SaaS is delivered over the Internet and from an off-site location, the distance between the user and the software can in some cases affect the usability of the software program.  Typically this is only really a factor with graphics programs or multimedia programs which rely on high resolution images or moving images.  If unsure, it’s worth contacting your software developer to check, or run a trial.

  • Not all SaaS providers are the same

Whilst some software developers will offer their own SaaS, the majority will make their software available for a wide range of intermediary value-add resellers (VARs) to provide as SaaS.  There are a number of advantages of using a SaaS VAR,  not least because they will offer the full suite of software required by your business, but they’ll also design and build a complete solution for you.  They should also help you with a suitable migration path, and ensure you are appropriately supported throughout any IT transition.  No two businesses are the same and this is as true for SaaS providers as it is for companies in your industry.  As such costs between providers will vary, technical capabilities will vary, software performance will vary, support levels will vary …

….Therefore, it’s extremely important to select the right SaaS provider for your business needs.


At Compare the Cloud, we’re here to help you get started and to help you identify suitable SaaS providers to evaluate and work with.  Take a few minutes to tell us about your company in our Cloud Comparison Tool, and we’ll present you with some informed options – and help you take full advantage of what Software-as-a-Service (SaaS) can offer.

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