A Complete Guide to SaaS

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A Complete Guide to SaaS

SaaS is one of the models that companies of every size are using to help provide for their cloud computing needs.

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Software-as-a-Service (SaaS) solutions, also called on-demand solutions are the talk of the town. SaaS makes up the largest segment of the cloud market and is expected to represent a 17.8 percent growth in 2019.

Exploring SaaS? This article will make it crystal clear on what SaaS is and why SaaS seems to grow so tremendously. We also differentiate between SaaS, PaaS, and IaaS and also demonstrate why SaaS application development is the best thing ever.

What is Software-as-a-Service (SaaS)?

One of the three components of cloud computing, Software-as-a-Service (SaaS) is a software distribution model in which a third-party provider hosts applications and end-users can access the software over the Internet.

SaaS application development eliminates the need for organizations to install and run applications on their own computers or in their own data centers, making the infrastructure investment null. This means; no shouting out to IT specialists to download software to each and every computer in your office or worrying about keeping the software on every computer up-to-date.

Let me explain what SaaS is with a simple example. If you go out to eat, you pick a restaurant, a menu, and pay to enjoy ready-made food. Everything else, including rent of the restaurant or space, the food cost, cooking, cleaning, and service, is handled by the restaurant. SaaS is similar in that it offers ready-to-use solutions for particular business needs.

Now that you have an idea of what SaaS is, let’s quickly, in brief, discuss the other two components of cloud computing — Platform-as-a-Service (PaaS) and Infrastructure-as-a-Service (IaaS)

The Difference Between IaaS, PaaS, and SaaS

IaaS, PaaS, SaaS - Difference


Platform-as-a-Service provides frameworks and environments that developers can leverage for developing, testing, and managing custom applications. So, the vendors provide the infrastructure and the developers code.

PaaS, instead of delivering software over the internet, provides a platform for software creation, unlike SaaS. Similarly to SaaS, developers don’t need to worry about the OS, updates, storage, etc.

Just like SaaS solutions, one can also opt for PaaS solutions with a pay-as-you-go pricing model.


IaaS comprises of automated and scalable resources with cloud storage and network capabilities to provide virtualized computing resources over the internet.

These cloud servers and the other resources are provided via dashboard and API.

IaaS clients have direct access to their servers and storage and additionally gain access to a much higher order of scalability.

In contrast to SaaS and PaaS, managing the OS, middleware, runtime, and other components are the client’s responsibility. The IaaS providers are responsible for managing servers, hard drives, virtualization, and storage. IaaS is said to be the most flexible cloud computing module.

Going back to the example of dining out, say you want to order a pizza. Here's a modified version of the chart above to reflect what those responsibilities would be:

Difference between IaaS, SaaS and PaaS

Where and When Can We Use SaaS?

SaaS can be used to develop any enterprise application — PO, DBMS, CAD, CRM, MIS, HRM, GIS, etc, etc.

Deloitte conducted a global CIO survey in 2018 and concluded that SaaS has been incorporated into the strategy of nearly all leading enterprise software development. 93% of CIOs said they are adopting or considering the cloud, and a majority (54%) expect to use cloud software for mission-critical applications within the next 3 years. Over 70% of CIOs cited scalability and agility as the motivation to adopt cloud.

Here are some examples of when you should use SaaS:

  • When you need the application to be significantly scalable
  • Applications with equal web and mobile demand
  • Quickly launching a business without worrying about server configurations and updates

Binaryfolks is a SaaS application development company, but that’s not why we are pushing you towards adopting SaaS. Let’s see why one should adopt or switch to SaaS solutions:

Leonardo Di Caprio asking someone to sell him a SaaS solution

Why Should You Use SaaS?

The global Software-as-a-Service industry is growing at an exponential rate. According to Forbes, the enterprise SaaS market is now generating $20 billion in quarterly revenues for software vendors, a number that is growing by 32% per year.

Benefits of SaaS

Multi-Tenancy Architecture

This means a single instance of the software is available to serve multiple customers. Therefore, all users and applications share a common infrastructure and code base that is centrally maintained.

This multi-tenancy makes it easier to customize SaaS applications in accordance with individual enterprise business requirements. Buyers can customize the look and feel as well as add custom fields, define business-specific workflows, play around with permissions, etc.

Multi-tenancy also reduces upfront cost because of the shared infrastructure as well as low maintenance costs.

Seamless Integration

To run a successful business, you need to integrate all your applications with one another. Integrating critical systems effectively is crucial to extend functionalities within the organizational silos and maximizing the revenue.

There are APIs to enable seamless SaaS integration with not only internal applications but also with other SaaS offerings. This minimizes development costs and maximizes the value of your SaaS investment.


As a business owner, you will always eye an option that is scalable. SaaS applications enable you to choose your own model that fits your business requirements and easily upscale or downscale it when a business requirement changes. So, there's no need for purchasing additional hardware when a company expands, only computing capacity like data storage, bandwidth, etc.

Cost Savings

In terms of importance, “lower overall costs” is the second biggest driver of SaaS adoption.

SaaS is generally subscription-based and has no up-front license fees. SaaS has a “pay as you go” model that relates cost to usage. If more components and services are used, price increases; if fewer are used, price decreases. AWS provides “pay as you go” pricing where charges are based on the number of instances, API requests, and other factors.

Painless Upgrades

Because SaaS applications are multi-tenant applications, instead of updating every instance, the codebase is updated and instantly accessible to all users.

If the SaaS application runs on a subscription plan, the fees cover the maintenance, upgrades, bug fixes and other costs. So, no need to install or download any sort of update or security patches.

Disadvantages of SaaS Computing

Loss of Control

On-premise software solutions dictate a higher level of control than hosted solutions as the control in hosted solutions lies with a third party.

Typically everyone has to use the latest version of the software application and cannot defer upgrades or changes in the features.


The SaaS application runs on a remote data center whereas on-premise applications will run on a user’s desktop. There might sometimes be issues with the performance in that case. A fast and reliable internet connection can help you get away with performance related woes.

Dependence on The Service Provider

With SaaS application development, there is a huge dependency on the service provider. If your SaaS provider goes bankrupt or if they decide to discontinue the service, you will not have access to your application anymore. Similarly, even if he decides to temporarily take the service off the network, then also you cannot use the application.

SaaS has its share of advantages and disadvantages. The advantages outweigh the disadvantages, though. There is a huge debate on whether SaaS application security is a benefit or a disadvantage for SaaS — let’s settle this debate once and for all.

Darth Vader finds lack of security in SaaS applications disturbing

SaaS Security

As time progresses, cloud networks are becoming more frequently used for enterprises and mission-critical business applications, so security becomes a top priority.

What Puts SaaS Apps at Risk?

  • According to Cloud Security Alliance, "Managing identities and access control for enterprise applications remains one of the greatest challenges facing IT today,"
  • Cloud standards are not that strong and cloud service providers often release very few details about their data centers and operations.
  • Under the SaaS model, applications can be accessed wherever there is Internet connectivity.
  • It's not always clear where the data is as sometimes the providers might need to move the data around due to load balancing and improved latency.
  • As virtualization enables single servers to store data of multiple clients, if someone hacks a single server, it puts the entire data of many customers at risk.
  • As data is hosted on the cloud, the clients have no control over the data. In the case of discrepancies, one has to rely on the provider for answers.

Despite all these, Bain and Co. have estimated the SaaS growth rate to be 18% CAGR by 2020.

SaaS Security Best Practices

  • End-to-end Encryption: End-to-end encryption is the most secure way of user-server interaction and is carried out over SSL connection. Encryption is essential for sensitive data, too. Make sure your cloud service provider provides customizable field-level encryption, too.
  • Vulnerability Testing: Use some industry-leading SaaS application monitoring tool to track the SaaS web applications and run lightweight scans to find vulnerabilities and risks. Choose a solution that has fully automated security assessments for testing the application health and also an on-demand scan functionality.
  • Data Deletion Policy: After a customer’s data retention period has ended, the customer’s data must be programmatically deleted.
  • VPC and VPN: Your SaaS provider can facilitate a cloud environment only for you instead of leveraging a multi-tenant instance so that you have control over all the data. This is referred to as a virtual private cloud (VPC) by AWS.

Users will be in complete control over their virtual networking environment, including selecting their IP address range, creating subnets, and configuring route tables and network gateways.

Parting Words

It is predicted that your business will grow by 19.63% if you move to the cloud. Also, SaaS solutions mean considerable cost savings. I hope this article paints a clear picture as to what SaaS can do to transform your business and give you that competitive edge over your competitors.

cloud computing, saas, software, software as a service

Published at DZone with permission of Jyotirmay Samanta . See the original article here.

Opinions expressed by DZone contributors are their own.

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