What is SaaS?
You have a brilliant business idea and want to create a software product that will both improve the effectiveness of companies and people’s lives and generate high profit? Then you might consider SaaS as a revenue model.
SaaS, or Software as a service, alongside IaaS (Infrastructure as a service) and PaaS (Platform as a Service), is a way of cloud-computing service delivery, where clients pay for software, hosted on a remote server, per each use or subscribe on a monthly or a yearly basis. There are three storage modes: public cloud — when infrastructure is hosted by third-party data centers, private cloud — within the company’s network, and hybrid — a mixed approach.
The popularity of SaaS has been growing for forty years. It appeared in the 60-ies because computers were huge and extremely expensive, and many companies couldn’t afford to have one. At that time, it was called the “time-sharing system”- an early form of the internet as we know it today. In the next two decades, despite the gradual decrease in size and cost of computers, SaaS, notably customer relationship management and accounting systems, remained cost-effective for many companies.
The late 80-ies and early 90-ies witnessed the advent of personal computers and Local Area Networks, used by employees of companies to access critical data stored on a central server, which can be viewed as predecessors of cloud computing. Later, the high cost of space on hard drives to store “bloatware”- additional, non-critical software, e.g., visual editors, created a strong demand for SaaS.
As the internet became widely available, and companies could use it to access data, it gave rise to the Application Service Provider Industry. The ASP model (not to be confused with ASP.NET technology) had several vulnerabilities, such as security, and was eventually replaced by SaaS as we know it today, with a different approach to code ownership and tenancy.
Advantages of SaaS
Irrespective of the business area, companies increasingly must deal with vast volumes of data, so being able to adjust operations accordingly is critical. Cloud technologies allow high scalability and much more, that’s why, soon, we will inevitably witness further migration of business applications to clouds. So, what other benefits does it have for business?
1. Flexibility is the king
Businesses want fast results and no complications. Already installed and configured in the cloud, SaaS applications are easy to deploy, accessible from any device and location. They don’t require employees to spend hours learning how to use them. It means your clients will be able to create and see value faster and make all the necessary changes effortlessly. For the vendor, no extra efforts are needed to sell — the apps are available 24/7, and the whole process is automated. In most cases, the client needs to subscribe, follow simple configuration manuals if necessary — and voila — it’s working!
2. No hassle
Businesses want fast results and no complications. Already installed and configured in the cloud, SaaS applications are easy to deploy, accessible from any device and location. They don’t require employees to spend hours learning how to use them. It means your clients will be able to create and see value faster and make all the necessary changes effortlessly. For the vendor, no extra efforts are needed to sell — the apps are available 24/7, and the whole process is automated. In most cases, the client needs to subscribe, follow simple configuration manuals if necessary — and voila — it’s working!
3. Less commitment, low investment risk
On-premises software needs a big upfront investment, which is irreversible. The subscription-based licensing allows your clients to test software for a short period, and then decide if it’s worth it. This factor adds credibility to SaaS solutions and boosts sales.
4. New features instantly
Differently from traditional applications, upgrades and updates get instantly available for all users. It means you can continuously improve the functionality and security of your business app in the background without interrupting the client’s operations.
5. Affordability for clients, profitability for vendors
SaaS is cheaper for the user as it requires much lower support and maintenance costs, as the infrastructure is managed by the provider. Besides, with subscription-based licensing, it allows paying smaller installments as long as it is justified. At the same time, an unlimited number of users means infinite possibilities for increasing the client base, and thus higher profitability compared to the on-premises software distribution model. As a vendor, you can quickly enter foreign markets as your software is internet-based, with no middlemen or resellers needed.
6. Security for everyone
Cloud technologies create robust security both for end-users and vendors. SaaS apps are reliable and secure, even if the number of users and, respectively, the amount of data is rapidly growing.
Future of SaaS
No doubt, the development of cloud technologies will further accelerate. SaaS has already become the golden standard, and it will be the only choice for mission-critical apps, which cannot suffer any downtime. As more and more companies will migrate to clouds, effective migration tools, and supporting apps will also be in high demand. The rapid development of AI and IoT requires enormous processing and storage capabilities, and cloud technologies will deliver.
Our approach to SaaS development
Everyone has different needs. We at Blackthorn Vision have enough experience and knowledge to create a wow-product for your end-users, whether these are enterprises or individuals. With hundreds of offers available now, quality is the decisive factor. We always strive to make your products so good that you don’t need significant investments in marketing, with word-of-mouth recommendations being the main sales-generating force.