SaaS or Software as a Service is when applications are hosted by a third-party provider and uses the internet to make them available to customers. There are three main categories of cloud computing, SaaS is a software distribution model that is one of them. The other two categories are Infrastructure as a Service (IaaS) and Platform as a Service (PaaS).
Organizations using SaaS eliminate the need to use their own computers or data centers to run and install applications. By doing so, the organization saves the expense of maintenance and software installation, support and licensing.
SaaS removes the need to pay for hardware acquisition and offers other benefits such as scalable usage, accessibility, updates automatically, and payments that are flexible. These other benefits will be explained in more detail below.
Scalable Usage: SaaS offers the customer on-demand options to gain access to their desired amount of features and services. These cloud services allow each customer to access as many or as few services as they want.
Accessibility: As SaaS is a cloud based Internet service, it can be accessed from absolutely anywhere in the world that has an Internet or wireless connection.
Updates Automatically: SaaS providers limit the workload of your business' IT employees by updating the software automatically for you. These automatic updates allow you to not have to purchase and install new software on your own.
Payments That Are Flexible: SaaS is typically payed month-to month as a pay as you go service. The recurring payments allow businesses to generate better predictability when it comes to their budgeting. The large benefit of an Internet based service, such as SaaS, is the ability to terminate the service at any time. Companies will not have to purchase hardware or software to install when subscribing to software as a service, saving them additional expenses.
SaaS does contain some disadvantages in its model. Companies have to depend on the providers of the software as a service to keep the software updated and working, protect the clients and business' important data, and provide accurate reports and billing. In addition, if the service providers have any unwanted server disruptions, breaches in security, or changes in options for service it will negatively impact the customer base of the business.