Software as a Service provides users with access to software that is installed on a network and does not need to be installed locally. Like Platform as a Service (PaaS) or Infrastructure as a Service (IaaS), Software as a Service (SaaS) is a subdomain of cloud computing. The software is operated on the premises of an external provider. Users require an Internet connection and a local computer client. In many cases, the software can be called up and run directly via the web browser. Software as a Service is not based on the traditional licensing model that allows users to purchase software along with the right of use. As the service recipient no longer needs to operate the software himself, a usage-dependent or time-dependent licensing model generally applies.
Software as a Service offers a whole host of advantages compared with classic software installed and operated on the user’s premises. Firstly, it avoids software purchasing costs, thus reducing the investment risk. Less time is required for implementation, as the service provider merely needs to unlock the software for the user. SaaS also reduces the complexity of IT systems and allows the user to focus on his actual business. The time and user-dependent price models ensure that IT costs remain transparent at all times. As an Internet connection is the only requirement for use of the software, the latter can be accessed from mobile devices without any additional investment.
A range of price models are available for Software as a Service. In many instances, a user-dependent or time-dependent fee is payable. However, sometimes the costs also vary depending on the software functions made available. The user can opt for only individual functions or the full range of software functions against payment of a corresponding fee. In another price model, the calculated fee is based on the number of user transactions. Such transactions may be online purchases or documents created. Further price models available include billing by CPU usage or data volume. Depending on the software, some providers also charge a one-off software setup or adaptation fee.