As a consumer of software applications, do you find it confusing as to how applications can be delivered; On-premise, hosted, SaaS? Further, with SaaS being the newest of the models and all the rage, do you find yourself asking, “What the heck is SaaS?” In this article, we’ll explain the differences, disadvantages, and advantages of the three delivery models. In a series of follow up articles, we’ll break down what constitutes SaaS from a technical perspective and provide some examples so once and for all, you’ll know what is truly SaaS. Here we go…
On-Premise(On-prem):
The application is loaded into your own datacenter. The application license structure is perpetual, meaning you purchased and own the licenses. You pay an annual support fee for technical support. Patches/hot fixes provided based on Support Licensing Agreement(SLA). New versions are not included. This is the traditional method of deployment. The disadvantages are that you must maintain the hardware infrastructure of the datacenter, cybersecurity threats, disaster recovery and backup, human capital to maintain environment, no or limited remote access, keeping up with new versions is expensive and very disruptive to businesses as they typically involve large technical and functional leaps vs small incremental ones. Finally, and typically the most important disadvantage, is this is the most expensive deployment model. The only real advantages here are you control the updates/new version cycles, and you own the licenses.
Hosted:
Hosted is very much the same as On-prem. The difference is the vendor takes the same legacy application and loads it into a 3rd party datacenter, such as AWS, Azure. There are no technical or functional changes to the application. The challenges are you still must pay for and deploy new versions, causing the business disruptions and you still have no/limited remote access. The advantages are a lower cost of ownership vs on-prem, you eliminate the need to maintain the infrastructure and you have built in disaster recovery and data backup.
SaaS:
SaaS applications are built on a completely different platform. Single code line, multi-tenancy(at the application level, not database level). Application licenses are on a subscription model vs you purchasing and owning. Application is housed in a 3rd party datacenter such as AWS, Azure or application vendor’s datacenter. All updates, hot fixes, new versions/releases, technical support are included in the annual subscription. The advantages are you will always be up-to-date and in technical support compliance, new versions are easier to deploy and much less disruptive as they’re less incremental, no customizations to manage, lowest cost of ownership, built in disaster recovery and finally, cybersecurity threats are removed in the event your datacenter is hacked.
So, there you have it, the three application delivery models and their advantages and disadvantages. As mentioned, in our forthcoming 5-post series we’ll share, according to NIST, what constitutes a true SaaS model. In the end, you’ll fully understand the three delivery models, the mystery of what is SaaS and what is not will be solved and you’ll be better informed so you can make smarter, more informed procurement decisions when it comes to software applications.