SaaS, or Software as a Service, is a computing distribution model where companies rent online software instead of buying and putting in it on their own computers. SaaS is a fundamental concept behind centralized computing where organizations lease their computing software from a host. All of the processing work is accomplished on the Internet, with customers accessing their tools and files utilizing a web browser.

Software as a Service refers to applications that are hosted by a vendor or service provider and made available to customers over a network, typically the Internet. SaaS is becoming an increasingly prevalent delivery model as underlying applied sciences that support Web services and service-oriented architecture (SOA) mature and new developmental approaches, such as Ajax, develop into popular. On the same time, high-bandwidth broadband service has become increasingly available to support user access from more areas across the world.

SaaS is intently related to ASP (application service provider) and on demand computing software delivery models. IDC identifies slightly completely different delivery models for SaaS. The hosted application management (hosted AM) model is similar to ASP: a provider hosts commercially available software for customers and delivers it over the Web. Alternatively, in the software on demand model, the provider provides customers network-based mostly access to a single copy of an application created specifically for SaaS distribution.

Benefits of the SaaS model include:

• simpler administration

• automatic updates and patch management

• compatibility: All customers have the same model of software

• easier collaboration, for a similar reason

• global accessibility

• affordability: organizations pays for computing power then want without having to purchase expensive hardware and software

In distinction to SaaS, the traditional model of software distribution, in which software is purchased and installed on personal computer systems, is typically referred to as software as a product.

SaaS describes the business model of customers logging into a centralized web host to access their software products. Users open their files and software only while online. With this model, companies don’t need networking equipment or a large IT employees in an effort to develop and preserve it. All an organization wants is their personal computers and an Internet connection, the host provides everything else including the hardware, software, and support staff.

To summarize, SaaS provides access to software and its capabilities remotely as a Web-based service. Software as a Service also allows organizations to access enterprise functionality at a value typically less than paying for licensed applications since SaaS pricing is based on a monthly fee. Also, because the software is hosted remotely, companies do not need to invest in additional hardware. Software as a Service removes the need for organizations to handle the set up, set-up and each day upkeep and maintenance. Software as a Service is typically referred to as simply hosted applications. With the quite a few benefits the SaaS model provides, it is becoming an more and more common option for businesses moving into cloud computing.