You probably have encountered the term SaaS and wondered what exactly it is. Short for ‘Software as a Service’ – this is a model in which an application is managed by a certain provider, paid for on subscription basis and accessed by users over the internet. In fact, you might have been using it right now without ever knowing that you’re one of the many who have driven the growth of Saas. There’s your popular iTunes, iCloud, Amazon Web Services, Microsoft to start with. There are many more notable service providers on the list. Sometimes, these are referred to as ‘on-demand’ software that you can use for business or leisure (or both). In the end, it’s all about convenience, customization, flexibility, collaboration and accessibility that turned SaaS applications into an integral part of how we do computing these days.
The Pros and Cons of the SaaS Model
For businesses, the major benefit is the cost savings of a subscription model vs. the large expense they will incur just to run and maintain an on-premise IT infrastructure. With the cloud comes a whole new world of possibilities, especially when you need to scale bigger, implement faster and run your business 24/7. Trouble is, along with these benefits come the risks. There have been talks lately on data security breach and government access to your private data which may adversely affect cloud providers in the U.S. Despite all the best packages around, system outages do happen and the last thing you want is a downtime. With the rise of many startups in the SaaS scene, the worst case is not having an exit strategy when that provider goes out of business.
SaaS: The Beginning of an End?
It is quite mind-boggling to learn that something this forward is getting a nasty bite where revenue is concerned. Just read this blog recently and the first few lines got me hooked: “Marketo filed for IPO with impressive 80 percent year-over-year growth in 2012, with almost $60m in revenue. Except, they lost $35m…” There’s something wrong in this picture. One reason I can think of for this major loss are serial switchers, those who will jump from one vendor to another because there are simply too many right now and most are offering freebies. Why would you upgrade to a paid account when you can get something this good.. for free?
When the Software Landscape Looks Greener for Small Businesses
Opinions are split though when it comes to the future of SaaS. There are those who say that this model is ready to take off. There is a push towards a single-sign up for multiple applications and more businesses are shifting from paper trail to going digital this time. Who wouldn’t want to work on something that delivers functionality without having to do patches and updates themselves? This may be great news for small businesses who, years ago, don’t have access to world class software. Now, they can compete with big brands on a fair game.
Wouldn’t it be right to say that SaaS is the greatest equalizer of them all? No matter who you are, you now have a cloud of opportunity waiting to be explored, thanks to powerful and affordable software solutions out there.