Buzzwords – What is software-as-a-service?
by Keris Lahiff
Software-as-a-service (SaaS) goes by many names – web-based software, on-demand applications or hosted software – which can make understanding it even more confusing. Whatever the name, it certainly has become a tech must.
With more technologies supporting broadband access and a greater network range, software is becoming increasingly mobile and the need to stay connected more essential – this is where SaaS comes to the fore.
Simply put, SaaS refers to the distribution model for certain programs and applications, that is, via the internet. Users access the programs from the ‘cloud’, rather than buying a physical software pack and installing it onto your hardware. This is the main point of difference of SaaS – it differs from the more traditional distribution models of software, sold in the box as a product.
Global IT research firm, Gartner, says SaaS is becoming a major contender to the traditional delivery models of software. In 2010, they forecast revenue in the SaaS market will surpass $8.5 billion, up 14.1 per cent from 2009 revenue.
How can I use it in my business?
The most common use of SaaS software is the customer relationship management (CRM) market, with SaaS accounting for 24 per cent of the total CRM market revenue in 2009. A CRM can organise, sync and automate interactions with clients, suppliers and business contacts.
SaaS is also useful for enterprise resource planning (ERP) applications, allowing internal and external resources to be tallied, tracked and managed.
According to Sharon Mertz, research director at Gartner, “The popularity of SaaS has increased significantly within the past five years and initial concerns about security, response time and service availability have diminished for many organisations as SaaS business and computing models have matured and adoption has become more widespread.”
How can it help my business?
So what’s the benefit to you? All benefits arise from its structural model – SaaS employs a multitenant architecture, where all users access a shared infrastructure, centrally maintained by the provider.
Instead of purchasing software, installing it to your personal computer and then paying licensing fees for multiple users, SaaS is simply accessed via the internet. This means no hardware or software needs to be purchased, maintained or updated beforehand, meaning little internal IT support is needed nor administration costs.
And, for those smaller businesses, there is no massive capital outlay in setup. Most SaaS applications are free or subscription-based. This also means once you purchase, you are not locked in with the software. If you are not satisfied, either stop using the software or review your subscription.
To stay ahead of the curve, security and software updates are handled by the provider, rather than downloaded by the user.
And, because the software is accessed via the internet, your data is globally accessible and compatible almost all devices with an internet connection.
A major downside for those with temperamental broadband signals is SaaS is only available with an internet connection.
Try Application Marketplace to browse the SaaS applications available. However, there are many free applications in the market so dig around a little to discover what can be best suited to your business.
Published on: Wednesday, March 02, 2011