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‘Pay for what you use’ is perhaps the reason enough for the growing popularity of Software as a Service (SaaS). Traditionally customers would pay a license fee for owning each piece of software, but with SaaS it is not the case, they are simply charged for what they use. The term SaaS has become the industry-preferred term, replacing the earlier terms such as Application Service Provider (ASP) and On-Demand.

Way back in 2000-2001, software as a service was rolled out for circulation. It is generally associated with business software as a low-cost way for businesses to enjoy the same benefits of commercially licensed and internally operated software.

Wikipedia defines SaaS as a software application delivery model, where a software vendor develops a web-native software application and operates the application for use by its customers over the Internet.

According to a market research firm, In-Stat, “Over the next 12 months the percentage of implementing a SaaS solution will approach the percentage of firms deploying traditional licenses in that market.

The key highlights of this research reveals that the accessibility to applications by remote or mobile workers is an important benefit to SaaS users and also to those who are interested in SaaS. The main inhibitors to SaaS adoption are security concerns for larger firms and a lack of perceived TCO benefits for smaller firms. Four out of five hosted productivity application users would recommend using them.