To SaaS or Not to SaaS?
Software-as-a-Service (SaaS) leads the growth of cloud computing. The SaaS consumption model provides more agility and cost efficiencies than many traditional methods of consuming software. However, while SaaS is a solid consideration for any cloud computing implementation, there are instances where it’s just not the right fit. This is an issue enterprises must unravel now, as cloud computing continues to gather steam.
Because SaaS is now a viable option, enterprises are faced with the dilemma of how to consume all types of software, cloud or no-cloud. The hype suggests the SaaS approach, but there should be careful consideration of all options, including SaaS and traditional approaches. Which is most cost effective? Which meets the enterprise’s core requirements?
SaaS usage avoids unnecessary hardware and software costs since you operate at a greater degree of efficiency, with SaaS resource consumption tied directly to cost. As your need for SaaS-based resources increases, you provision only the resources you require. As your needs decrease, you’re able to de-provision the resources. Since SaaS is usage-based billing, you only pay for the exact capacity you consume.
Considering this model, SaaS is generally more cost efficient than on-premise solutions. There are some specific values to SaaS that those who adopt SaaS technology should understand:
- The ability to operate at a lower cost of production. Companies are able to operate applications, databases, and support end-users at a much lower cost of production than before. SaaS, and cloud computing in general, does a much better job of sharing resources, and the more resources that are shared, the lower the production costs.
- The ability to reduce risk. IT organizations can now share risk with the SaaS provider. With SaaS, companies only pay for services leveraged just as they would with a public utility (gas, electricity, water).
- The ability to shift around technology changes. As technology changes over time, the platform for keeping up with those changes gets better, perhaps abstracting enterprise IT from the need to deal directly with those changes. In the case of public SaaS, this is rather obvious. Public SaaS installations are different each and every time you connect to them for services. They constantly upgrade software to provide better services, or expanded capacity. This occurs automatically, typically without the involvement of enterprise IT or the cloud user.
For a few organizations, there is another side to this argument. Organizations that will realize a cost advantage to leveraging on-premise systems have the following characteristics:
- Pre-invested in a large amount of hardware and software, without any way to recover that capital.
- Under regulations that require information to reside on private and tightly controlled hardware and software.
- Cost of SaaS services for comparable on-premise systems are exorbitant.
- Do not have a culture that will readily accept the use of software systems not owned and controlled by the company.
Overall, there are a few conclusions that you can reach when considering SaaS for your enterprise:
First, SaaS is typically going to be a more cost effective and resource efficient choice compared to traditional approaches. Indeed, you should consider SaaS by default, and then determine those instances where it’s not a fit for some business or technical reason. You won’t find many.
Second, while security is a concern, most SaaS-deployed systems are actually more secure than traditional approaches. Security is a function of the approach and the technology, not the location of the processing or data.
Finally, the use of SaaS needs to rollup into a larger cloud strategy, including the use of IaaS and PaaS. As enterprises deploy more cloud components, they need to work together effectively.
David S. Linthicum is an IT industry thought leader, a frequent public speaker at enterprise conferences such as Interop 2013 where he was the Cloud Track Chair, and he’s the author of 13 IT books including “Cloud Computing and SOA Convergence in Your Enterprise.”
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