Software-as-a-Service

What is SaaS?

Software-as-a-Service (SaaS) refers to a model where software is hosted and delivered in the cloud. As opposed to the classic license model, users no longer have to install the software themselves. Instead, subscriptions and access via web browser are common. In this article, you will learn everything you need to know about the advantages and use cases of the SaaS model.

Definition

How does Software-as-a-Service (SaaS) work?

Software-as-a-Service (short: SaaS) is a cloud-based model for the licensing and delivery of software applications.

When a software is offered as SaaS, a customer can access and use it via the Internet without having to install the software themselves. Hosting, maintenance and updates are commonly handled by the SaaS provider.

For the users of such SaaS applications, the model offers some core advantages: Companies are able to save costs on servers, staff and IT service providers while at the same time reducing the complexity of their own IT infrastructure. Furthermore, many SaaS applications offer additional benefits when it comes to usability, security and scalability.

Due to these reasons, more and more companies are adopting the use of SaaS for all sorts of core tasks and business functions. Today, a wide variety of applications are available as Software-as-a-Service, including Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) systems such as Salesforce and SAP, text and image editing software like Microsoft Word and Adobe Photoshop or messaging platforms such as Slack.

Software-as-a-Service (SaaS)

Advantages

What are the advantages of Software-as-a-Service?

For users of SaaS applications, the most important advantages include the following:

  • Lower costs for IT infrastructure and personnel
  • Quick adoption
  • Improved access options
  • Performance optimization
  • Scalability and flexibility
  • Low investment risk
  • Improved collaboration

Lower costs for IT infrastructure and personnel:
When using SaaS software, companies save costs for hardware, databases, security systems and similar expenses existing in a classic on-premises model. Furthermore, IT services such as maintenance, backups and updates can be shifted to the SaaS provider, reducing costs for external IT service providers and allowing the IT department to focus on different projects. Last but not least, costs for SaaS subscriptions tend to be a lot more transparent.

Quick adoption:
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