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April - 2008 - issue > Technology

SaaS - The emerging model for packaged software

Ramesh Loganathan
Monday, March 31, 2008
Ramesh Loganathan
Packaged software offers a relatively low-hassle solution for enterprise business processing. The product vendor takes the responsibility of building the application, getting enhancements and supporting the solution. Eliminating the need to have development teams onboard to build and maintain the solution SaaS, Software as a Service, is taking the out of the box solution model a step further. In SaaS, the software is made available as a service, eliminating the need for even hardware, licenses and production support teams.

In SaaS, typically, a specific application or solution is offered in a managed model with the client just signing up for the solution and accessing it over the web- all operational aspects taken care by the SaaS provider. SaaS provider takes care of hosting and managing the production operations. The Software is either completely hosted or parts of the functionality hosted. The enterprise will just need to sign up and the solution is available- in a traditional utility model, ‘off the tap’. This lets the small enterprise focus on its core business and not have to deal with any aspect of the IT solution operations.

SaaS has been gathering momentum through 2007, fuelled by off-the-web server-virtualization platforms such as Amazon’s EC2 adding momentum to the rapidly gaining acceptance of services such as salesForce.com.

The definitions for SaaS are a bit elusive. Per IDC, SaaS is Software with network-based access to, and management of, commercially available (i.e., not custom) software. Applications or solutions will now be delivered as a managed ‘service’ available for access over the web. The client just asks for it, subscribes, and gets access to the solution. No hardware to buy, no installation or configuration and no administration, monitoring or tuning.

Use cases for Packaged solutions and enterprise applications
The obvious use case for SaaS is end business solutions that would otherwise have been offered as a licensed product that must be procured and installed. For such solutions, SaaS offers a hassle free model. The Independent Software Vendor(ISV) building the solution can now offer the solution in a subscription model- wherein the enterprise client just subscribed to using the solution for a given period. The ISV takes care of getting the required setup and configuration, and the users need simply access the application over the web. No hardware or software to buy. No installation. No configuration. No setup. No maintenance. All aspects taken care of by the ISV.

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