The concept of software as a service (SaaS) took hold at a time when IT executives were getting supremely fed up with the ballooning costs of packaged enterprise software. Not only did they have to shell out thousands of dollars just for the licenses, but they also had to spend tens if not hundreds of thousands more to implement the software. There were the consulting fees. And the training costs. And the extra infrastructure that was required to run the software in addition to ongoing maintenance fees. Thus, SaaS emerged from the wreckage of botched multimillion-dollar ERP and CRM implementations as a radical alternative to traditional software licensing models. SaaS promised easier, speedier and cheaper implementations.
Advantages of SaaS:
1. SaaS deployments usually take less time than on premise software implementations simply because you’re not installing software on every user’s computer.
2. Because SaaS is easier and quicker to implement than traditional software, you can achieve ROI faster, too—provided, of course, your users adopt the software.
3. Upgrades also tend to be pretty seamless (because you haven’t customized the software), and you’re always on the most recent
References: 1. http://www.saas.com/ta/hp.jsp Retrieved 26 April 2014 2. Software As A Service: Strategic Backgrounder: Software & Information Industry Association. 28 February 2001. Retrieved 26 April 2014.