Five myths about SaaS debunked

Is SaaS (software as a service) a trend that is gaining more and more of a foothold in IT departments, or is it doomed to be the bastard stepchild of traditional software?

Jeffrey Kaplan from Computerworld recently set out to debunk five common myths about the SaaS model. He had some interesting points to make which we have summarized in the bullets here below.

  • Myth 1: SaaS is a peripheral trend. Kaplan referred to a survey showing that SaaS usage had jumped from 32% in 2007 to 64% in 2008, and that 90% of the survey respondents were satisfied with the SaaS model and planned not only to renew their subscriptions but also planned to expand their usage of SaaS.
  • Myth 2: The SaaS model offers just one type of application. Aside from being offered on a subscription basis and using a single code base for all users, there is already a diverse range of SaaS applications available, and they are becoming increasingly customizable. There are more than 950 companies offering SaaS in over 80 industry and technology areas.
  • Myth 3: SaaS just provides simpler versions of more sophisticated applications. Kaplan argues that although SaaS applications are easier to deploy, users aren’t necessarily sacrificing functionality. He mentioned increased enterprise adoption as a sign of this and pointed out that large organizations constitute the fastest-growing customer category for (which is the popular poster boy for the SaaS model).
  • Myth 4: SaaS is less reliable and secure than on-premise applications. Although service interruptions for Google Apps and have put the SaaS model into question, Kaplan pointed out that these problems are not all that common, and that many enterprise outages last longer. As for the security aspect, no major compromise of a SaaS application has happened yet, opposed to numerous accounts of security breaches in traditional IT environments.
  • Myth 5: IT professionals are uniformly opposed to SaaS. While some worry about the implications of SaaS when it comes to both risks and their own livelihood, SaaS is according to Kaplan gaining acceptance among IT professionals. One of the reasons for this change is the perception that SaaS will rid them of much of the hassles of traditional software.

What we think

We’re essentially offering software as a service ourselves here at Pingdom, and for an application such as ours (a site monitoring service) the SaaS model is ideal.

That said, we still think that SaaS still isn’t suitable for everything. Anything that requires a significant amount of CPU horsepower per user (heavy graphics operations, for example) will for the foreseeable future be much more efficient as a local instead of a hosted application. But we’d love to be proven wrong, because SaaS is a very appealing model with a lot of upsides both for providers and end users.

A while back we wrote a detailed analysis about the pros and cons of SaaS that you may want to have a look at (it’s from all the way back in 2007, but as relevant now as it was then): Are hosted applications the future?

What do you think?

Do you agree or disagree? What are your opinions about SaaS?

1 comment

  1. An excellent and concise summary.

    I was a SaaS skeptic but watched it evolve over time – and because it DID evolve, grow, and meet challenges, it has matured over time to become very reliable. I recall when I first used Salesforce a year ago, and was blown away – my own skepticism was destroyed.

    Too many people treat SaaS as something that’s still new – it’s not. It’s just taken awhile to get where it is.

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