Software as a Service (SaaS) is a software distribution model. This is where a third party provider hosts applications. They make them available to customers over the internet. It is one of three categories of cloud computing. These include Infrastructure as a Service (IaaS) and Platform as a Service (PaaS).
It is like the Application Service Provider (ASP). It is also related to on demand computing software delivery models. It’s hosted application management model is like ASP. The provider hosts the customers software. It delivers it to approved end users over the internet.

In the SaaS model, the provider gives customers network access to a single copy of an application. This is created for SaaS distribution. The source code is the same for all customers. Customers receive new features upon release. Each customer has a Service Level Agreement (SLA). Their data may be stored locally or in the cloud. It may also be stored in both.
Companies can integrate SaaS applications with other software. This is done using Application Programming Interfaces (API’s). A business can write it’s own software tools. It can use the providers API’s to integrate their tools.

SaaS applications are popular in the commercial sector. These can be for email, sales management and CRM’s. They are also used for financial management, human resources and billing technologies. Leading providers of SaaS include Salesforce, Oracle, SAP, Intuit and Microsoft.
Applications are also used by I.T. professionals and business users. This makes it perfect for all businesses regardless of their size.

Using SaaS means you don’t need to run or instal applications on your own computers. It also reduces the need to run them in expensive data centres. You do not need to buy expensive hardware or pay for maintenance. Neither do you have to worry about software licensing and support. Other benefits include:

Easy Payment Structure: There is no need to buy any software or hardware. Customers subscribe to a SaaS offering. You buy this on a pay as you go basis. Billing is monthly. This helps with cashflow and budgeting. You can cancel recurring offerings at any time. This means you only pay for what you use.

Expandable Usage: SaaS offers high expandable usage. This gives customers the option to buy more or less, based upon their requirements.

Instant Updates: SaaS providers will carry out all updates. They will also undertake any patch management. This frees up more time for your I.T. team.

SaaS Accessibility: SaaS applications can be accessed from any internet device or location.