Tools for Understanding SaaS

Patrick Avery

It's hard to be optimistic in a down economy, but those providing software-as-a-service might have reason to feel encouraged. IT Business Edge Editor Ann All writes about the rise of SaaS citing recent reports by Gartner and Computerworld, which expect a significant increase in SaaS spending by IT companies this year.


To better comprehend SaaS, a good place to start is in ITBE's Knowledge Network with the SaaS Primer, provided by KN partner THINKstrategies.


This tool explains that SaaS is a software deployment model in which an enterprise application is delivered and managed as a service by the vendor to meet the needs of multiple customers simultaneously. SaaS solutions are delivered via a network, most often the Web. They are priced on a subscription service basis, often based on the number of users or seats. This SaaS model shifts the burden of getting and keeping an enterprise application up and running from the customer to the vendor. It permits users to leverage the software functionality without the burden of deploying and managing the software themselves. It also eliminates the added costs and complexities of deploying additional hardware and software, or dedicating additional staff resources to support the enterprise application on an ongoing basis.


The SaaS document cites the following as SaaS benefits: accelerated software deployment with less risk; lower up-front costs; no additional hardware and lower internal staffing requirements; greater reliability, security and privacy; higher productivity and ROI; greater agility to scale software to meet changing business requirements; and quicker time to value. Other issues covered in the primer include upgrading from legacy applications, data security and subscription information.


One of the ways users can keep track of SaaS issues when deciding what to do is by using the SaaS Checklist, provided by ITBE contributor Michael Stevens, who also provides a SaaS vs. On Premise TCO Calculator. The calculator presents two results: TCO, and annual costs, which is the sum of the annual licensing/subscription fees, annual management costs, and the total cost of start-up and upgrades amortized over the number of years in the calculation. The purpose of this calculator is to let you quickly compare the total cost of ownership of a SaaS solution to the TCO of an on-premise solution. The values this calculator provides can serve as a first step in determining whether the potential delta between the two approaches is large enough to warrant further investigation.


Another option for those looking for third-party support is Cloud Computing. Cloud computing is essentially the SaaS model expanded to include hardware-driven functions like storage and processing.


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