I. Benefits of SaaS
A)  Benefits for SaaS customers.

1. Freedom to focus on core business - Customers can now focus and channel their energy on their core business and there's no need for them to spend money, time, or effort in concentrating on internal IT departments.

2. Save Cost & Time
   a. Lower IT costs - When customer we go for SaaS, they spend money in their own IT department
   b. Low pricing and better budget forecasting - SaaS pricing is based on a monthly fee that's actually cheaper than paying for licensed applications. It also helps organization forecast IT expenses.
   c. Save time in development, deployment, and maintenance -SaaS applications are ready to go and maintained by the SaaS provider so the customer is free of these responsibilities.

3. No extra hardware required - Software is hosted remotely so the customer doesn't need to invest in additional hardware except for the PC needed to access the application.

4. Less software required - Customers may only need a browser to use the application or maybe a plug-in for some software.

5. No installation needed, easy maintenance, scalability, and availability - SaaS providers do the installation, setup and often the daily upkeep, 24/7 uptime, application security, monitoring, and maintenance.

6. Availability of new industry standards and technology trends. -SaaS providers constantly update their application to incorporate new technologies and standards related to both IT and business to remain competitive. SaaS customers benefit from this.

7. Service level management - A simple SLA covers the responsibility of the SaaS providers and SaaS customer. This should be well defined for areas like performance and availability, security, DR&BP, and licensing.

8. Greater satisfaction and freedom of choice - SaaS vendors should see a higher level of customer satisfaction, broader user adoption and higher renewal rates. And if SaaS customers are dissatisfied, they can move to a different SaaS provider.

9. Global accessibility - Customers can extend their services to new geographic locations.

1. Low Cost and Time:
   a. Setting up a portal for a new customer is easy since all customer share the same implementation.
   b. Cost is saved for the same reason.

2. New customers - With reduced overall costs and more value-added services, more SME will start availing themselves of the benefits of Web applications.

3. Easier administration - Because of shared resources, administration is easy. Fewer people are needed.

4. Easy configuration management - With most customers using the same code base the provider has less overhead maintaining the CM for each of them.

5. Automatic updates and patch management - Upgrades are automatically pushed to end users, reducing effort and allowing vendors to deliver more targeted customer support.

6. Easier collaboration and version compatibility - All customers have the same software version so upgrades and maintenance are simplified.

7. Easy to rollover new standards and technology - Since all customer share the same instance/code implementation it's easy to add new features or introduce new standards or technology innovations to all or most customer in a few shots

A. SaaS can be seen as an improved version of the older application service provider (ASP) technology while on-demand is an expression used by many companies to describe a set of products and services. SaaS is a key tool in achieving on-demand capabilities.

Q2. Are there any companies that support SaaS?

A. Yes. There are lots of companies that either provide platforms or standards or create SaaS-based products A few of them are: Microsoft, SAS Institute, Salesforce.com, NetSuite, Symantec, BMC Software, Macrovision, ATG's OnDemand Solution, SugarCRM, Intacct, Buizmatics, and Ibackup's Profit Cents.

Q3. Is any threat to data security from SaaS applications?

A. No. Well-architected, well-made SaaS applications don't have this problem, but it also depends on how the SaaS provider implemented the security model and what the security and backup policies are.

Q4. Can each SaaS customer have a separate database?

A. Yes. There are three approaches in which an SaaS application can manage multi-tenant data, Please read the Data Access Layer part in this article.

Q5. Is SaaS a viable option for all Web-based applications?

A. No. There a few cases where SaaS is not a good option, For example, if the applications requires:
a. Integration with other systems
   I. When it requires tight and ongoing integration with legacy and in-house systems.
   II. When it requires integration with applications supported by other SaaS vendors especially if their systems aren't interoperable.
   b. Implementation of SaaS customer-specific business processes and workflows
   I. When the situation requires implementing unique business processes specific to a customer for competitive advantage or code-level modification.

Q6. Is a SOA architecture necessary to make a Web application a SaaS application?

A. No. but SOA architecture plays a key role in making a better SaaS application.

Q7. Is SaaS technology-specific?

A. No. Any application accessed over the Internet regardless of its technology can be an SaaS application.

Summary
SaaS has become one of the fastest growing segments of the IT sector because it provides organizations with turnkey software solutions that can be implemented quickly avoiding incremental infrastructure costs and eliminating the ongoing administrative resources of traditional on-premise applications. Table 2 compares SaaS- and non-SaaS-based applications.

An SaaS application is accessed over the Internet and is distinguished by three qualities, scalability, configurability, and multi-tenancy, and its architecture is open-ended, highly scalable and extensible, loosely coupled, easily configurable, fully secure, and highly customizable. Supporting Web services and SOA, it's easy to add new Business Services in an application and enable an SaaS application to integrate with other SaaS applications. The key to developing SaaS-based applications is the design of the applications framework. Application frameworks should be flexible, open, and robust enough for new features to be added easily to an application.

So adopting a SaaS model is a win-win situation for both the SaaS customer and the provider/aggregator. It's also beneficial to all SME who can't afford to have dedicated or in-house business applications, but need a Web presence to stay in business and be competitive.

References

1. Software as a service: http://en.wikipedia.org/wiki/Software_as_a_Service
2. Architecture Strategies for Catching the Long Tail: http://msdn2.microsoft.com/en-us/library/aa479069.aspx
3. Multi-Tenant Data Architecture: http://msdn2.microsoft.com/en-us/library/aa479086.aspx
4. Software as a Service (SaaS): An Enterprise Perspective: http://msdn2.microsoft.com/en-us/architecture/aa905332.aspx
5. Perspectives of the IASA - Special Issue: Software as a Service: http://files.skyscrapr.net/users/fredch/blog/iasanewsletterdec2006.pdf
6. White Paper: Five Benefits of Software as a Service: www.trumba.com/connect/knowledgecenter/software_as_a_service.aspx
7. IDC predicts SaaS trends: www.networkworld.com/weblogs/applications/011589.html
8. Trends in Software as a Service: www.pcworld.com/article/id,135119-pg,1/article.html
9. Software On Demand: www.forbes.com/enterprisetech/2004/07/20/cx_ld_0720bizondemand.html