Welcome to SaaS thoughts

Whether you call it Software as a Service (SaaS), Managed Service Provider (MSP) or On-Demand Services, your organization uses the service running “in the cloud”. This blog will discuss these services, their benefits, drawbacks and operations. Are we biased? Yes. We believe that some services make sense for most organizations. Email security is one of those. However as Mark Twain said, “All generalizations are false, even this one.” Each Tuesday we will post information and questions about Software as a Service. Occasionally, we will have a "Guest Post" from either a consultant or vendor posting her/his thoughts on Managed Services generally as well as some degree of specificity based on her/his unique perspective. We encourage your insights, comments and feedback. Welcome.


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What Are The Benefits of Using A Managed Service?

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What is SaaS?

Software as a Service simply means that rather than have a service (email, email security, backup, CRM, application) running on one of your computers, you subscribe to an outside company and use the application running on one of the service’s computers. Salesforce.com is an example of a Customer Relationship Management (CRM) SaaS. Google, Microsoft and others are now supplying software as SaaS applications.

So, what’s to be gained and lost?

Each SaaS must be judged on its own merits. However, here are some general and a few specific pros & cons.

Gains

Cost – Compare the cost of running the application in the data center or on the desktop against the cost of the subscription service. Don’t forget that cost is not just the initial license fee. That is usually the only cost considered when evaluating a SaaS. Backup systems usually require additional hardware as well as software. Software applications can be expensive to acquire. “Renting” applications via a SaaS often gets the organization access to very expensive applications at a “pay as you go” rate.

Blended Systems was using a CRM running on one of our computers. It works quite well and is available to all users in the physical office to track our customers and prospects. However, since we are a virtual office, accessing the internal CRM via a browser from outside the office is only available via a very costly upgrade. We elected to use Salesforce instead.

Time – Consider the installation and administration time, administrative upkeep. These are often hard to get metrics on but, are worth the effort.

Data Center – Consider rack space, power and cooling requirements. Racks are getting full and Blade Servers take both power and cooling.

Losses

Component Deployment – A local service may provide more granular control over component deployment. Some services have bundled pricing for components. You may not want all components for all users. In the example of Blended Systems’ Salesforce deployment, adding the Marketing application to allow a small segment of the user population requires licensing the application for all users even though those users do nothing with marketing directly. That being said, traditional software applications may have the same restrictions on component licensing and deployment.

Access – The service running on a computer in the data center is viewed as being more “reliable” or “available” than the service running “somewhere else”. Indeed, depending on a service outside your LAN does pose the problem of access. If someone “cuts the cable” that application is unavailable. That aside, the service’s data center is probably far more robust than any data center a company can deploy for that same service by several magnitudes.

Browser-Based – Is the SaaS an application? Can you use it without an Internet connection? Is there an additional cost?

Cost – Is the cost of the SaaS going to eventually cost you more than the service running on your LAN?

Control – This is a tough one. There is a perception that if it is in my data center, it’s under my control. In many instances, that is true. Certainly, authentication directories, business data and documents are more secure on a LAN than on a Managed Service. However, does that data always stay on the LAN? How about documents sent via email? Are they encrypted? How about documents sent via Instant Messages? How about the VPN? Can that be cracked? We haven’t even discussed data on a missing laptop or PDA.

What do you think? What services can you safely turn over to a Managed Service? What are the benefits? What are the drawbacks? What’s your experience with SaaS?


Next Post – We’ll discuss Control in the next SaaSthought. Stay tuned.


Posted on : Mar 26 2008
Tags: , , ,
Posted under Managed Services, SaaS |

One Person has left comments on this post

Apr 15, 2008 - 02:04:56
Ian Moyse said:

Major benefits that customers have cited over the past few years are as simple as more protection (you can gain more scanning engines and with faster updates in the cloud for both virus and spam protection), more resilience – nothing to manage locally and no single points of failure and improved accuracy on filtering.


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