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SaaS Maintenance Software vs Locally Hosted B2B Software

  • Last Updated: September 28, 2012
  • Greg Arbour
  • 2 min read

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Why you should get ready to love SaaS Maintenance Software

Software as a Service (SaaS) is simply defined as software that is hosted remotely and delivered through the web.  Notable examples include Google Apps, iCloud and Salesforce CRM.  Instead of buying the software license outright (eg. $300 for a copy of Microsoft Office) you rent the software on a monthly or yearly basis (eg. $20 a month to use an Office Suite over the internet).  This is SaaS; a different distribution model for software.  Over the last few years, SaaS has been aggressively seizing market share from traditional un-hosted software products, like SaaS Maintenance Software

In North America, ease and speed of deployment are primary reasons for SaaS adoption, followed by [a] lower TCO (Total Cost of Ownership)

We will explore why this is and what makes SaaS so effective as both a tool and business model that benefits all parties involved, as well as some of the trade off’s that come with switching to a SaaS solution.

Total Enterprise SaaS Revenue (Billions of Dollars)

Total Enterprise SaaS Revenue (Billions of Dollars)

The plunge into the Cloud is often based on the following four pain points:

  • Lack of resources to build an infrastructure
  • Up-front Software licensing costs are too expensive
  • Lack of resources, especially in IT
  • Lack of technical know-how to maximize benefits of IT systems

Additional Factor’s Driving increase is SaaS usage

  • Cheaper, faster internet access and more mobile devices
  • Customer frustration with typical software buying cycle (license + support + upgrades)
  • Increase in control over the vendor relationship (easier to cancel contract and change software packages)
  • Fast deployment, reduced dependence on internal IT
  • Simplified pricing models

Advantages of SaaS Over Traditional Models

The rise of SaaS, and in particular SaaS maintenance software, is primarily due to the fact that it’s easier for the consumer.  Easier to try, easier to buy, no installation, easier to upgrade and generally, there is less of a need for an additional department, like IT to get involved.  Here’s why:

Lower total cost of ownership – Subscription based model also means less initial upfront investment.  Additionally, this incentivizes software vendor to build a higher quality product and with more support in order to reduce churn and maximize their customer’s lifetime value.  McKinsey estimates put TCO of SaaS delivered software would be up to 40% lower than traditional on-premise software.

Low Barriers to entry – No network/firewall configuration + subscription based pricing model means software is easy to get started with.  Very low barriers to entry (and exit) can only benefit the customer.

Automatic upgrades – without the need to reconfigure or reinstall. With SaaS upgrades are commonly included as part of the software service.

More accessible – available anywhere you have an internet connection.  On the road, at home, while waiting for your flight.

Risks associated with SaaS:

Like any new technology, there are considerations to be made that may make SaaS unviable for some companies.

  • Third-parties handle confidential data
    .  This may or may not be a bad thing.  It simply outsources the security handling from the customer to the SaaS Provider.
  • Customization and integration with custom systems could be an issue
  • Lack of full control over data and processes and often upgrades
  • Although some software services work asynchronously, most dependent on an internet connection

Fiix is a fully functional SaaS product.  See how Fiix mitigates risks associated with SaaS.

SaaS vs. Unhosted B2B Software

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