What is SaaS? Is SaaS better than traditional software?
With the wide use of the internet, a lot has changed in the software industry over the years.
Before the internet came out, to use any software you had to buy a copy of the software and run it on your own computer.
When the software got outdated you had to replace it with the latest version which costs you more money.
Sounds expensive? Ever wondered where those traditional software distribution methods are today?
SaaS replaced the traditional software.
You may ask, what exactly is SaaS and how it outperformed traditional software.
Let’s get into that.
What is SaaS?
SaaS is the abbreviation of the term software-as-a-service.
SaaS is the method of distribution of software over the internet.
You don’t have to buy the software in its entirety. Also, there is no need for manual installation and maintenance.
The service provider’s data center is where all the resources stay.
To use the software the only thing you have to do is create an account with the service provider.
You can “rent” their service for as long as you need with a small fee.
How does SaaS work?
The SaaS uses the Software licensing and delivery model.
In this model, the host company holds ownership of the product. They provide the access to the software for a subscription fee.
A single authority controls the distribution of the software hence centralized.
SaaS is a form of cloud computing.
Cloud computing is the process by which you store and access software and data over the internet.
It is different from the traditional systems where you had to use your computer’s storage.
It helps you save your storage space and at the same time offers better functionality.
To use any SaaS product you only need a stable internet connection and a web browser.
SaaS uses a multitenant architecture.
Many users could use or ‘share’ software hosted on a single server.
These service providers often use a subscription model as a payment option.
You could rent the software for a particular period of time. The most common options are monthly or yearly.
Some service providers use a concept called ‘Freemium’.
In freemium, the basic functionalities are free of cost. You have to pay for any extra functionalities.
These services could either be prepaid where you pay first and then use it.
Else they could be postpaid where the pay-as-you-go method works.
Pay-per-user is also a popular model. Here the billing depends upon the number of users involved.
Other common abbreviations related to SaaS:
- IaaS — Infrastructure as a Service
- PaaS — Platform as a Service
- DaaS — Desktop as a Service
- MSaaS — Managed Software as a Service
- DCaaS — Data Centre as a Service
- iPaas — Integration Platform as a Service
- ITMaaS — Information Technology Management as a Service
Messaging, file storage & sharing, CAD, development, games, accounting, and invoicing are some common areas where SaaS is dominant.
Major SaaS companies:
- HubSpot
- Slack
- Dropbox
- Zendesk
- Salesforce
- Shopify
- MailChimp
- SurveyMonkey
- Amazon web services
- Google Cloud Platform
- Microsoft 365
- WordPress etc.
As we now know the basics of SaaS let’s take a look at what are the advantages of using SaaS.
Advantages of SaaS:
#1. Cost-effective:
SaaS is cost-effective because there is no need for any extra hardware.
For example, you are a software startup and have limited funds to spare.
In that case, setting up a data center could get heavy on your limited budget.
Price soaring of your product is another problem.
You are new to the market and are yet to build credibility. Selling an expensive product at the beginning itself could be a big no-no for the customers.
But with SaaS, this could get cheap.
You could rent the computing and data storage features from a third-party vendor.
This will save you a lot of time and money and also some customers.
While using SaaS you are only paying for what you are using, not more.
But in traditional software that’s not the case. You have to pay for the whole thing even if you have very little use.
#2. Easy accessibility:
With SaaS, there is no installation required to use the software.
You could use it on any compatible device. The only prerequisite is a stable internet connection and you are good to go.
You can log in to your account from anywhere and from any device and use the service.
This eliminates mobility restrictions.
#3. Easy to deploy:
Creating a personalized data center could take several months.
Assembling the hardware without making any errors is also another challenge.
You need to have the technical expertise to do that.
But in the case of SaaS, deployment could take only a few weeks at most and you are in business.
#4. Easy scalability and easy updates:
When you are trying to scale your business with SaaS you could upgrade to a more effective plan.
You don’t have to buy a whole new set of equipment. SaaS companies have various available options to choose from.
There is also less trouble in updating the software. Due to a single server, only updating the source is enough to enable all the users to use the updated version.
There is no need to distribute separate copies as it was with traditional software.
That makes SaaS cost-effective for the users.
#5. More customization and compatibility:
The concept of API ( Application Programming Interphase ) helps a lot.
With APIs, you can expose a limited part of your software to other software providers.
It creates a middle ground for safe experimentation. It can help to add new features to the system with the integration of many software providers.
That ensures more functionality of the software.
The features and functionality sound good. But is it safe?
Companies have sensitive user information. Sharing it with third-party vendors doesn’t sound good.
How does SaaS tackle that part?
The disadvantages of using SaaS:
#1. Issues with data security:
User data like personal details and analytics are on the servers of the service provider.
It questions the data security of the company and its users.
In case of security breaches, data theft could be a major problem.
Another threat could be data loss.
If something happens to the host servers then your stored data could vanish. You will not have any control over the issue.
#2. Customization limitations:
If you are an individual using SaaS you don’t need much customization.
The customization features these companies provide are enough for your personal needs.
But in the case of big corporations, they have their own customization needs. In that case, SaaS may not solve their problems.
The customization needs of a big corporation are more complex than a small website.
In that case, they need to have their own software to do the job.
#3. Latency:
In simple terms, latency is the delay between the user action and the desired response.
Suppose you saw a web page and clicked on the link to enter it.
Latency is the time taken to get the website loaded on your screen.
The online transaction processing sites need response time in milliseconds.
Delayed response time could cause many problems like failed transactions or unexpected errors.
In gaming platforms also, higher latency could cause a bad experience for the users.
#4. Not applicable for non-internet users:
Cloud computing needs the internet for its functionality. Without the internet, SaaS will not exist.
If someone doesn’t have access to the internet then they could not use the software services.
There is no other way around it.
#5. Switching vendors could be a daunting task:
Suppose you need to transfer your site from one vendor to another.
In that case, you have to go through a lot of technicalities to do the task.
If there is any compatibility issue, that could be a huge problem.
You always need to check for transfer compatibility before you use SaaS platforms.
Doing so will leave room for future transfer requirements.
Concluding thoughts:
Traditional or cloud-based software, whatever your preference is, there will always be doubts.
Cloud computing technology is showing rapid and promising improvement.
Developers are giving more importance to customer privacy and user experience.
Keeping those facts in mind it seems like a safer option to upgrade to a cloud-based system.
Even if you don’t want to be dependent on SaaS you can still incorporate some part of it.
That will definitely be cost-effective and more efficient.
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