Introduction to SaaS

SaaS (or Software As A Service) is a hot topic in the hosting industry. However, SaaS is not a new concept and in one form or another it has existed for many years. Recently SaaS became especially popular. Maybe this is mainly because of the recession and the need to cut costs, rather than because of the the advantages of SaaS itself. Anyway, now SaaS is drawing more attention and is frequently regarded as the way to drastically cut costs with no sacrifice to quality.

Definition of SaaS


SaaS is a form of cloud computing. In fact, it is maybe the most popular form of cloud computing because it is targeted at the general public, rather than on the IT community itself. The idea of SaaS is simple: you subscribe to a SaaS service provider vendor, who installs and configures the software applications you need and you just use these applications. Basically, you rent software rather than buy it and you also spare yourself the hassle to install and deploy these applications.

For anybody, who is not familiar with the process of purchasing, installing, and deploying software, SaaS might look a useless service. However, anybody, who has had the pleasure to choose a software application, pay a hefty price for it, spend months on installation, deployment, configuration, customizations, etc., SaaS looks like the answer to their prayers. Well, it is not correct to say that SaaS is only gold - not at all, SaaS also has its disadvantages - but as a whole, the SaaS model is efficient in many ways.

The Ups of SaaS

SaaS is really a cool trend and the benefits it offers are numerous. The three most important among them are:

  • No need to buy the applications, deploy them and maintain them. There are hardly many IT departments, where employes are not up to their ears with work and the last thing they need is a new application to fight with. There is no doubt that when you own the application and deploy it in-house, you have full control over it but this process, not to mention the ongoing maintenance after that, is so time consuming and it takes so many resources, that reason presses you not to do it, unless the application is really a very special one. Well, if the application is a very special one, after you have tried it as a SaaS service, you can buy it later and install it in house - it is that simple.
  • No need to maintain the equipment and infrastructure. The cost of the application itself and the costs related to its deployment and ongoing maintenance could be a small fraction of the TCO (Total Cost of Ownership). Equipment and infrastructure are also substantial expenses. In some cases you might be able to use your existing infrastructure and equipment, but if you have to build them both from scratch, then the costs become really high.
  • Lower costs. Cost savings are a direct consequence of the fact that you don't buy the application, don't pay your staff to install it, deploy it, and configure it and you don't have to buy new equipment or build a new infrastructure. For many IT managers cost savings, not the other benefits of SaaS, are the main reason to choose SaaS over in house deployment. However, if SaaS wasn't a technically superior solution, no IT manager in his or her right mind will ever choose it simply because it is cheaper.

There are more benefits of SaaS one can think of but only the above listed ones are enough to draw your attention to SaaS.

The Downs of SaaS

When we say that SaaS is a good solution for companies of all sizes because its ups are so great, this doesn't mean that there are no glitches as well. Here are some of the downs of SaaS you need to consider:

  • Dependency on the SaaS provider. As we already mentioned, if you want to have full control over your installation, you can do it only when you install it in house. With SaaS you are using the capacity of a third party, which is an independent company, and it is quite natural not to have control over their operations. Additionally, all equal, with SaaS you have less flexibility than when you install in house. However, if the SaaS provider you choose is a professional one, lack of control and flexibility are not issues to worry about.
  • Security issues. As a result of the fact that you don't have full control over the installation of the applications you are using, come security issues. There is no need to be a security paranoid in order to worry about what happens to your sensitive data on its way to and on the servers of your SaaS provider. Visions of hackers might be chasing you, but if your SaaS provider knows their business and applies the necessary security measures to address the security issues related with SaaS and cloud computing in general, your data is safer with your SaaS provider than if you were storing it in house. Your SaaS provider is capable to protect your data in a better way - the question is if they do it or not.
  • Limited applications. SaaS vendors offer the most popular applications, which doesn't necessarily mean the applications you want are in this group. If you want a rare application, it is quite possible that most SaaS vendors don't offer it because it is not feasible for them to buy it, train their staff how to use it and keep installations of it. In such cases you might have no other way but buy the application and install it in house. Alternatively, if the application you want is not that important to you, you can replace it with a more popular similar application your SaaS provider offers.

The downs of SaaS are negligible as a whole but in some cases they could be more than you can take. As with many other choices you have to make, one of the most important choices is the SaaS provider itself. If you choose a SaaS provider, who doesn't offer good service, this might make you hate the SaaS model in general because your experience will be kind of poor. However, if you choose a good provider, you will see for yourself that SaaS is a great solution.


Written 2010-01-11 (Updated 2016-10-10)
Share your thoughts

W,  11 January, 2010

Thanks for this great introduction - it helped me alot!

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