What is Software as a Service?

Steve Ingall (MD, Fox IT)Earlier this year, Steve Ingall (MD, Fox IT) spoke at the UKCMG Service Level Management Seminar. Steve discussed Service Level Management through ‘Software as a Service’.

Software as a service (SaaS) is a software application delivery model where a software vendor develops a web-native software application and hosts and operates (either independently or through a third-party) the application for use by its customers over the Internet. Customers pay not for owning the software itself but for using it. Wikipedia 2007.

The key characteristics of SaaS software include:

  • network-based access to, and management of, commercially available (i.e., not custom) software
  • activities that are managed from central locations rather than at each customer’s site, enabling customers to access applications remotely via the Web
  • application delivery that typically is closer to a one-to-many model (single instance, multi-tenant architecture) than to a one-to-one model, including architecture, pricing, partnering, and management characteristics


  • Salesforce.com (CRM)
  • Service-now.com (ITSM)
  • GoToMeeting.com (Net Conference)
  • Employease.com (Self Service HR)
  • Google.com (Search)

Why adopt SaaS?

Several important changes to the way we work have made this rapid acceptance possible.

  • Everyone owns or has access to a computer
  • Computing itself has become a commodity, even a utility
  • Applications are becoming standardised
  • Parametric applications are now usable
  • The specialised SaaS provider can target a global market
  • Web systems are reliable enough
  • Security (SSL and VPN) is sufficiently well trusted and transparent
  • Availability of enablement technology (Net 2.0)
  • Wide Area Networks’ bandwidth has grown dramatically

What does SaaS mean in reality?

  • No hardware to procure
  • No software to license and install
  • No maintenance charges
  • No major internal support costs
  • No long implementation project
  • Enterprise functionality for the SMB
  • SMB prices for the Enterprise
  • Rapid return on investment
  • Lower total cost of ownership

The Software & Information Industry Association (SIIA) Software Division has some white papers with more information about SaaS.

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