Friday, March 09, 2007

SaaS as I understand


I intend to learn more about three software philosophies that are driving and will drive the future course of software development and delivery models: Open Source Software, Software as a Service(SaaS) and Web 2.0, which will work collaboratively to sustain each other. Though you might all be familiar with these concepts, and the information provided here may not be anything new, I take this as a personal learning experience and hence post my notes here for my own reference. It might also serve useful to anyone who wants to have an exposure to these concepts. I also intend to touch upon yet another software culture which might follow the current wave, and that is the blend of Open Source Software and SaaS, called Open Service.

For this post, I will start with SaaS.

SaaS is a model of delivering software services that are hosted on third party servers and accessed through regular web browsers, unlike the classical deployment model where the packaged licensed software is installed in local hard drives.
Wikipedia defines Saas as, “Software as a service (SaaS) is a model of software delivery where the software company provides maintenance, daily technical operation, and support for the software provided to their client. SaaS is a model of software delivery rather than a market segment; it assumes the software is delivered over the internet. Software can be delivered using this method to any market segment, from home consumers to corporations.”

The architectural principle for SaaS is known as multitenancy, where a single instance of the software runs on the provider’s servers, and all users log onto that same instance.

This delivery model has the following advantages:

  • Complexity: The need for installing, maintenance, securing and upgrading software gets eliminated. IT expenses because of this gets eliminated by 55%. The service provided will not deal with servers, staging, version maintenance, security, performance etc. any more.

  • Time: Deploys faster than regular software.

  • Cost: Minimises application deployment and maintenance cost. In the earlier model, customers had to wait for years for big versions and then suffer business interruption during deployment. Also it has to bear a retraining cost for the new version.

    Key players involved: Salesforce, SAP, Oracle, Microsoft with its Office Live offering

    The target market for SaaS are small and medium enterprises (SMEs). Though the verticals range from CRM and sales management, the largest segment for SaaS revenues is Web conferencing and collaboration.

    Though the SaaS market is still plagued with problems like inadequate broadband access and data security concerns, it is here to stay which is evident by SaaS`being embraced by big enterprise software guns.


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