Who Benefits Most from Adopting SaaS?

by Mingdi Xin

The software as a service (SaaS) model has matured as a viable strategic alternative to conventional software service options. With SaaS, customers do not own software but instead share a common code base and set of data definitions that clients are unable to modify. Customer-specific configurations and functional extensions are logically separated from the common code, and customers maintain them. Integration is made through common Web services APIs. All customers are running on the same version of the software; SaaS vendors decide and implement new developments and keep all applications on their most current versions. The technical and managerial characteristics of SaaS have important implications for a customer's adoption decision: