Software as a Service
In the traditional model, software vendors develop and sell application packages to
customers. Typically, customers purchase licenses that give them the right to use the software under the terms of the license agreement. Although this model still accounts for most
software acquisition, a new model, called Software as a Service (SaaS), is changing the
picture dramatically.
SaaS is a model of software deployment where an application is hosted as a service provided to customers over the Internet. SaaS reduces the customer’s need for software maintenance, operation, and support.
FIGURE 7-2 Microsoft’s SaaS platform promises better value and a new concept called
Software + Services.
In a highly competitive
marketplace, major vendors constantly strive to
deliver new and better
solutions. For example, as
shown in Figure 7-2,
Microsoft claims that its
SaaS platform offers the
best solution and business
value. Microsoft also promotes a broader vision,
called Software + Services.
The Web Host Industry
Review shown in Figure 7-3 is
an online source of information about SaaS products,
trends, and events. In a published report, the Review
quoted a Gartner, Inc. prediction that 25% of all new business software will be deployed
as a service by 2011, while the
value of the SaaS industry will
grow to $40 billion