How Does the SaaS Model Work?

For many years, software was sold much like any other product. A disc was sold, sometimes along with a product key, so the purchaser could install that software on a single machine. This method is still used today in some cases, but more and more businesses are choosing to change their software delivery model to software as a service (SaaS) using a cloud VPS. The name may give some hints as to what SaaS is all about, but many people still aren’t sure how the model works, or how it could benefit them or their business.

Software “Rental”

One of the biggest differences between SaaS and previous software delivery models is that users of the software rent the software, or more accurately, pay for access to the software for a certain amount of time. Instead of paying a single lump sum and getting a disc to use forever, the purchaser makes smaller payments each month. This can be advantageous to both the seller and user of the software; a steady flow of income is generated for the creator of the application, and the user doesn’t have to spend extra money each time a new version is released.

Online Access

For the most part, SaaS only provides access to their software online. This is because the software itself is actually stored on a server, and not on the computer that is accessing it. This means that software performance is dependent on the quality of the hosting service and the business’s Internet service provider. Fortunately, ISPs are always improving in both reliability and speed.

No Installations

One major advantage of the SaaS model is that software doesn’t have to be installed on a particular machine in order for that machine to access the software. This means you don’t have to install a bunch of software each time you purchase new machines, and it also means that you won’t have to worry about handling updates on multiple machines. Employees can use the software whether they’re at work or on their home computer.

Hosting

If you’re going to adopt SaaS to deliver software, or want to start renting your software through such a model, you should know that the success of SaaS is dependent on its hosting service. A cloud VPS (virtual private server) is a portion of an extremely fast server dedicated to hosting and delivering your software, so as long as you choose a VPS through a reputable service provider, you should have all the stability and speed you need.