SaaS Enablement

With traditional software, customers buy a perpetual user license. This gives them the impression that they own the software and can use it in perpetuity. With SaaS instead of owning the software, customers pay for a subscription to software running on the infrastructure of the SaaS provider. The customers do not loose the right and ownership of data stored on the infrastructure of the SaaS vendor but they loose the right to use the software once they stop paying the subscription.

Below is an attempt towards the listing the parameters towards comparing SaaS with on-premise models:

  • Software: Eliminates the needs to buy software licenses, application servers, database servers
  • Hardware: Eliminates the needs to buy servers, network storage, backup systems etc.
  • No software / hardware replacement is required
  • Reduced spending on IT operations costs
  • No re-implementation costs
  • Reduced technology migration costs
  • SLA’s for ensuring superior operations
  • Faster time to value as there is no hardware/software to procure, installation and configuration


With such an increased focus on cloud computing, there is still resistance from ISV’s to migrate their solutions to the cloud. There is no clarity in what the customer would choose: on-premise model or SaaS model. Most of the ISV’s have already invested heavily in building on-premise solutions over a period of time. The fundamental requirement for a SaaS application is to be multi-tenant. This becomes the driver for the technical requirements. Existing solutions cannot be suddenly moved to a SaaS platform due to the following challenges:
  • Existing solution is designed to be single tenant.
  • Existing solution is built using legacy technology which needs to be modernized to new technology platform.
  • Upfront investment is required to re-engineer the existing solution.
  • Existing solution needs to provide out-of-box support to integrate with 3rd party on-premise solutions

The SaaS model offers substantial cost and economies of scale benefits to both ISV’s and and the customers, encouraging ISV’s to provide their offering in SaaS model.  ISV’s  need to deal with multiple challenges that need to be evaluated before deciding on the path to invest upon.

Source: Cloud Computing Journal