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Cloud Computing and SaaS: Software as a Service

Cloud Computing and SaaS: Software as a Service

SaaS – Software as a Service From the old term of ASP or Application Service Provider, the service of providing Software Applications On-Demand over internet dates back a decade or more.  However, with Cloud Computing entering with real time zeal, SaaS is banging enterprises with resurgence.  During the year 2009 – 2010, the significant industry buzz has turned towards Cloud Computing – a wider and broader concept than SaaS or ASP itself.  As per Gartner, SaaS revenue within enterprise was pegged at around $ 7.5 Billion in the year 2009 and for the current year estimated to be around $ 8.5 Billion.  As per IDC study, the total revenue of SaaS in 2009 was $ 13.1 Billion.  Last year, more than 50% of enterprises have already implemented one or more SaaS application for their enterprise.


Software as a Service is more alive now than Software! Salesforce.com is the poster child of SaaS.  The company which struck the Software! Currently, Salesforce claims to have more than 80000 SaaS customers. The first and perhaps, the only company that has reported more than a Billion dollars in revenue in the cloud computing industry space.  The company itself claims to be the “enterprise cloud computing company”, has been ranked as Fortune’s fourth fastest growing company last month. The company is well known for its CRM – Customer Relationship Management – SaaS offering.  The 2010 CRM Market Awards for the Best Enterprise Suite CRM, Best Mid-Market Suite CRM, Best Small Business Suite CRM has been bagged by Salesforce from CRM Magazine. As in the case of major software vendors, Salesforce.com has fully utilized the power of Network partner and Channel sales to become Leader in SaaS.

SaaS Benefits

SaaS Considerations

The first wave of SaaS companies moved traditional Enterprise Applications like CRM – Customer Relationship Management on to the hosted cloud platform.  Now almost all enterprise software companies are porting their application and delivery model to SaaS.  From the perspective of SaaS user, Security is one of the prime concerns. The identity management in the cloud, SaaS offerings without any Standards,  Secrecy about the Internals of SaaS Service Companies, the threat from ubiquitous access methods and devices, moving the data away from its territory are cited as major risks to consider before adoption.  On the other hand, 61% of the enterprises who have implemented one or more SaaS applications feel that they are satisfied and say that their expectations have been fully met by SaaS.

The top 5 SaaS categories are: CRM and Sales Automation, Online Data Backup, E-Mail Spam /Anti Virus Control, Accounting and Payroll Management and Network Monitoring tools. The studies conducted with enterprises show that they are readily moving to the categories like E-Mail Spam Filtering,  Network Monitoring tools etc… as they are the first candidates of cost cutting from Capex. (Capital Expenses.)

The Last Word

SaaS provides some real benefits to enterprises of whatever size and so is gaining ground fast.

By Glenn Blake

About Glenn Blake

Glenn Blake is a writer for CloudTweaks and has been writing about technology trends for over 25 years.

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