What is Software as a service (SaaS)

What is Software as a service (SaaS)

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Software as a service (SaaS) is a method of providing a ERP software from a hosted environment.  SaaS is also know as Hosted software or On-Demand software.  This system allows the user to rent the package for a selected period of time, unlike the traditional ERP the users don’t want to purchase the package and license.  SaaS model users will make software subscription instead software acquisition.

SaaS model reduces the investment on the infrastructure and its regular maintenance since it is not hosted on-premises, the internet delivers the user requirements to their system.  The model has made the users to move from fat client to thin client.  Selective modules can be chosen by the user, which offers lower cost.  SaaS limits the implementation time and risk involved.

SaaS model software’s are ready to use, any user can start accessing the system from the day one of their subscription.  SaaS model made most of the mid-size companies to move from their regular traditional ERP’s, since they feel this model is very light and can be accessed from any where any time.  The development in cloud computing played a great role in improvement of SaaS.  The cloud based ERP and SaaS implementation has increased the interest globally, since this ease the purchase and implementation process it is expected the software cloud market will reach up to $50 billion by 2014.  The current growth rate in Cloud based software is about 25% when compared to 2013 and expected to more in the future.

The Forrester researchers found that, by 2014 about 34% of all new business software purchases will be consumed via SaaS, and the delivery constitute about 14.5% of worldwide software spending across all primary markets.  Cloud-based ERP currently comprises around 2% of the market, but is set to grow by about 21% annually through 2015.


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