March 2009 / Software as a Service/ Infrastructure as a Service

As a business you know that you need to spend money to make money, but now more than ever you know that you need to spend smarter. And when it comes to spending smarter, one of the areas that strategy pays off the most is with your IT investment.

All too often businesses fall into the trap of spending too much or too little on technology. But what if you could invest in just the right amount of technology for your current business needs? That’s the idea behind Software as a Service and Infrastructure as a Service – two on-demand models that are changing how companies purchase their technology. In this month’s Tech Brief we’ll take a look at how Software as a Service and Infrastructure as a Service work and help you decide if they make sense for your business.

What is Software as a Service?

Software as a Service (SaaS) is a software distribution model in which applications are hosted by a vendor and made available to customers over the Internet. SaaS works as a “pay-as-you-go” model with customers typically paying a monthly fee based on the number of licenses they use.

There are a number of differences between SaaS and “traditional” software:

• The application is hosted at the provider’s central location, allowing the customer to access it remotely from anywhere via the web


• A customer can increase or decrease their number of licenses depending on need


• SaaS licenses are not tied to a device, and as such can be shared among multiple machines across the network


• Patches, updates, general maintenance, and technical support are handled by the provider

Examples of SaaS include Salesforce, Netsuite, and Google Apps.

What is Infrastructure as a Service?

Infrastructure as a Service (IaaS) is similar to SaaS in that a product is offered via the Internet to a client as an on-demand service; but instead of software, IaaS delivers hardware such as servers, network equipment, memory, CPUs, and disk space.

You may be wondering how it’s possible to deliver physical hardware over the Internet. Well an easy way to understand IaaS is to think of website hosting. When you pay a company like Network Solutions or GoDaddy.com to host your website, you’re buying physical space on their servers for your web files to reside. Using the Internet you can add, remove, or modify those files just as you would if that server was in your office - except in this instance you’re working with equipment that may be thousands of miles away.

So why would you want to pay a monthly fee for hosted equipment instead of just having it in-house? Here are just a few of the reasons why companies are turning to IaaS:

Scalability

Just as with SaaS, IaaS is a pay-as-you-go model which allows you to scale up or down depending on your needs. When it comes to pricey hardware, you can save a lot by buying only what you use.

Disaster Recovery

Fire, theft, malfunctioning sprinklers – there are a myriad of ways to lose equipment and data. With IaaS your hardware and the data located on them are housed in secure data centers which are mirrored, backed up, and typically come with a Service Level Agreement which makes getting your services back up and running in the event of a disaster the vendor’s problem and not yours.

Time Back

With your infrastructure being hosted offsite you free up your IT staff to focus on value-added tasks such as planning and development, instead of running around patching machines and fixing bugs.

Examples of IaaS include Amazon Web Services and Flexiscale.

Does SaaS or IaaS Make Sense For Your Business?

As with most technology services, what works wonders for one business might not make sense for another. So how do you if SaaS or IaaS is a good fit for yours? It really depends on your situation:

• For businesses that are just starting up and not sure what direction they want to move in with their technology, SaaS and IaaS are ideal ways to lease hardware and software at a low cost to find out what works.


• For smaller companies that experience constantly fluctuating staff numbers, SaaS is a great way to pay for only those licenses that you need in any given month. On the other hand if you’re a mid to large-sized business with many employees, the monthly reoccurring cost of SaaS licenses may be far more expensive than a one-time bulk license purchase when looked at over a 1, 2 or 3 year term.


• If you need to implement a complex business application or system that would require adding IT staff with specific and expensive areas of expertise to support it, SaaS or IaaS can be a great way to get support and training for the application included with the investment into the application itself.


• If you find yourself facing space, power, and capital expenditure issues due to the increasing number of in-house servers and storage you’re purchasing, IaaS may be a solution that makes sense. IaaS can help eliminate many of the negative aspects of IT expansion while still giving you the processing power and storage space you need.

Final Thoughts...

There’s a lot of grey area when it comes to software and infrastructure spending. Although the goal of SaaS and IaaS is to make that process easier, it can still be confusing depending on your unique situation. Your best bet is to take is to work with someone who can analyze your specific needs and help you determine what SaaS or IaaS solution, if any, is best for your business. Thrive not only has experience in helping our clients choose the SaaS and IaaS solutions that make the most sense for their business, we also have experience in using and delivering them ourselves. If you would like to learn more about Software as a Service, Infrastructure as a Service, or have any concerns regarding your IT please contact Thrive at any time.