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Section 1: What is SaaS?


Software as a Service (SaaS) is becoming mainstream with a significant increase in both offerings and enterprise adoption.

There are several advantages to SaaS – scalability, accessibility, and little to no Capex requirement, among others. However, SaaS is a catchall for a variety of software delivery models. There are three distinct models of SaaS, all of which come with their own restrictions:

  • A true multi-tenant solution (where there is only one instance of the code and a single database).
  • A hybrid solution (where there is a single code base but a separate physical database for each customer).
  • A single-tenant, hosted solution (where each customer has their own instance of the code and physical database instance).
    While the commercial model may be the same, it is important to understand the underlying technical model to determine if the solution is a fit for a company’s needs.

What You’ll Learn

  • The fundamentals of Software-as-a-Service
  • Something else about SaaS

Quick Note

SaaS solutions tend to be secure, in general. However, they can be more vulnerable if they are hosted in a public cloud, as most multi-tenant solutions are.

While end-users tend to be the weakest link in the security chain, it is important to determine if the solution provides for data encryption at both rest and in transit.

What is Software-as-a-Service (SaaS)?

SaaS stands for software as a service, which means software is hosted by a third-party provider and delivered to customers over the internet as a service.

While most SaaS products are aimed at business users, some products have proved popular with individual consumers, like note-taking app Evernote or personal finance tools like TurboTax and Mint.

In business settings, users access productivity applications or enterprise software from a service provider instead of from their company’s private data center.

Microsoft 365 and Salesforce are common examples of such SaaS software used in business that had been previously hosted and distributed by businesses’ own data centers.

SaaS is a marked difference to the old model of making a one-off purchase of software that must be hosted, implemented, and maintained by the buyers themselves.

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