Software as a service (Saas) is a way of delivering software that allows data to be accessed from any device with an internet connection and a web browser. In this service model, software vendors host and maintain the servers, databases, and code that make up the application. The cloud model is now so common that 69% of organizations have accelerated their cloud migration over the past 12 months and 60% of IT decision-makers state that cloud capabilities have helped their organization achieve sustainable revenue growth over the past 12 months according to this survey article from Foundry Co https://foundryco.com/tools-for-marketers/research-cloud-computing/

SaaS vs On-Premise

The traditional on-premise software delivery model differs from SaaS in two important ways. SaaS deployments do not require a large amount of hardware, allowing buyers to outsource most of the IT services typically required to maintain the software in-house. Secondly, SaaS systems are typically paid for under a yearly subscription or contract based model, while on-premise software is typically purchased through a perpetual license that is paid in advance. On-premise users can also pay up to 20% per year in maintenance and support fees for onsite staff. The annual or monthly fee for a SaaS service will typically include the software licensing, support, and most other fees that would be associated with an on-premise model.

History of SaaS

Saas started back in the late 1990’s when companies like Salesforce started offering traditional business solutions like Customer Relationship Management (CRM) through a SaaS model. However, in a speech to MIT students back in 1961 John McCarthy, a renowned computer scientist who won the Turing Award for his work in artificial intelligence (AI), said “The computer of the future will be organized as a public one.” In other words, John hinted over 60 years ago at the concept of cloud computing as a shared computing power resource.

Data Security

The most common questions are who owns the data and is it safe in the cloud. While most cloud platforms consist of multiple software and hardware components, which those may be sourced from multiple providers and it’s not unusual for their subsystems to be outside of the direct control of the cloud provider, it is imperative for SaaS clients to confirm what and how security is handled from the vendor in their service level agreements(SLAs). Some SaaS providers will have the ability to integrate with existing identity access providers giving some control to the client in integrating permissions. In terms of the data, most SLAs confirm your company’s ownership of your data located on the vendor’s servers, as well as your right to retrieve the data to your own data centers or company machines at anytime. It is highly unusual for any vendor to insist that they retain ownership of your data. Most SLAs will also have built-in and prepaid contingencies that will provide access to your data if the vendor goes out of business and guarantees that you own that data.

Future of SaaS

The future of SaaS will continue to grow due to the low upfront and maintenance costs. However, the security of data could be the part of the equation that could drastically change things. Additionally, depending on content and your business model, hosting providers have their own terms and conditions that they require their customers to adhere to. Let’s look back at what happened to the upstart social media platform Parler in 2021. Their website was hosted with AWS and when their terms and conditions were violated, their website was removed and they had to start over with an on-premise version. So, what is the future of SaaS, will you fully trust your data and security to big tech or trust a smaller firm to handle these services for you? Would you want to hire your own team to manage on-premise servers and have to replace parts all of the time. These are the decisions IT leaders will have to make in the coming years.

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