For the last few years’ software as a service (SAAS) has become more common with many software organizations offering their software applications which are hosted and maintained on remote servers. Software as a Service (SAAS) is the term used for letting customers use software applications using the Internet. The SAAS model is being used to provide a wide range of software applications. Services can be inventory control, database processing, human resources, accounting, procurement, billing, customer relationship management (CRM), sales and marketing, enterprise resource planning (ERP), and business intelligence (BI). Because the service provider hosts both the application and the data, the end user is free to use the service from anywhere. Marked improvement in server virtualization, distributed computing and high-speed internet have contributed to the birth of this cloud computing technology.

Benefits of SAAS service model are:

Subscription based payments – SAAS is priced as a subscription model. Businesses only pay for the users who have benefited from the software during each month. This eliminates large initial payments and annual license, support and maintenance charges.

Third party hosted – Investing in expensive infrastructure is no longer required since SAAS software applications are now hosted by the provider. There are no capital costs for hardware, licenses, databases or IT support staff or software and hardware maintenance and upgrades. Software applications are accessed via a web browser or a mobile device via a wireless network connection keeping customer’s IT requirements simple and low cost.

Predefined costs – SAAS provides agreed predefined fixed charges. This helps to project and predict the annual costs while planning for the annual budget.

Multi-Tenant Efficiency – Some SAAS solutions use multi-tenant architecture. The cost of all software and infrastructure is shared by a large number of customers. This makes the solution more cost effective.

Location-independent Accessibility – Being Internet based, SAAS applications are accessible not only in the office but from any location with an internet link.

Flexibility and Scalability – SAAS provides businesses with a high level of flexibility and scalability. Since, the software solution is delivered via the Internet; SAAS requires the minimum of infrastructure at the customer’s end. Also as the business grows you can request your service provider to add more users.

Availability and Security – SAAS providers ensure uninterrupted reliable services with regular data backups, and information security. Redundant networks stand-by power, up-to-date security and intrusion detection necessary factors provided by SAAS services.