Disruptive technologies are emerging, and a lot of people are trying out new ways to distribute their products to reach their target audience(s). With so many new products emerging on a daily basis, along with pay-as-you-use models, will Software as a Service remain relevant in modern day?
In this blog post, we are exploring the benefits and drawbacks of SaaS, as well as go over what new platforms are emerging to challenge it.
What is SaaS?
SaaS is a type of cloud computing that is subscription based, which you must have an internet connection for. A user must pay to use the service regularly – often on a monthly basis – to access the content without disruption. Some examples you may have heard of include Azure, Dropbox, Xbox Game Pass, Office 360, Salesforce, and Adobe Creative Cloud.
Users do not purchase the software, so you do not have to pay big bucks for on-premise solutions. Cloud-based solutions are ‘pay-as-you-use' services, so when you stop using the service, you can stop paying for it. Many SaaS models operate on yearly or monthly payment plans with the option to set up bill reminders and automatic pay.
Additionally, you do not have to manage the software. All updates and changes are made by the company that provide the service, which is the company that owns the software. This saves you time because you don’t have to deal with the upkeep of the software you’re using.
There are also tiers of many SaaS models that allow you to choose which level of access and functionality you need. We’re going to jump into examples in just a moment that illustrate this concept (Hint: Xbox Game Pass).
We just mentioned how there are some models that have different tiers of accessibility. Sadly, that’s not always the case. With some software-as-as-service models, you’re locked into paying for a lot of features at a fixed monthly rate. So, what if you don’t need all of those things? If you review your assets and pick and choose which services you need, you can lower your monthly cost and be more efficient with your budget.
For example, some argue that paying $99 for five features you use, along with five features you don’t use, is silly because you could pay only $50 for the five features you do use. This correlates with a burger example that you may have heard.
Some people ask, “Why do I have to pay full price for a burger that I am taking components away from and won’t be consuming? If I ask for the lettuce, tomatoes and onions to be removed from the burger, why should I pay full price for it?”
SaaS doesn’t allow you to remove unwanted features at a discounted rate. You have to pay full price for the software being provided to you. So, your options are to find a way to use those services by implementing them in your business somehow or risk not getting the full advantage of the software you’re paying for.
Another drawback is that users cannot make modifications to the service because it is not owned by the subscriber. So, it’s not possible to opt out of some of the updates the providers apply to the service you’re paying for, which could be a point of contention for some users.
Ongoing Businesses and Software Model Innovation
There are numerous application programming interface (API)-only products on the market that are extremely easy to use. One example of a successful SaaS model is Dropbox.
Dropbox is a “cloud storage service, which means you can copy your files to the cloud and access them later, even if you’re using a different device” that is utilized by business professionals from around the globe. Thousands of people use the storage platform as a digital filing system for documents, photos and more.
People can sign up for Dropbox online for free. But, businesses wanting to utilize the cloud services can pay for a Dropbox Business, which can be billed to your organization yearly or monthly. Dropbox Business gives users access to more cloud storage and advanced features including advanced control and security.
Another thriving model of SaaS is Xbox Game Pass.
With more than 100 games to choose from on the cloud-based application, gamers can pay a monthly fee to access and enjoy as many games within the month that they want.
The “Ultimate” tier provides subscribers with the best experience the Microsoft-operated software can provide. It includes “Xbox Live Gold, unlimited access to over 100 high-quality console and PC games, new games added all the time, Xbox Game Studios titles when they premiere, and exclusive member discounts and deals”.
Those that want all of those features other than Xbox Live Gold can choose from two other monthly subscriptions to enjoy for a lower cost. Subscribers can also cancel their subscription at any time.
Enterprise-level Software Solutions
There are numerous ways an enterprise can benefit from customized software solutions.
One benefit of SaaS in a large-scale organization is that a monthly billing cycle for services makes far more sense than an incomprehensible spreadsheet full of micro-transactions based on internal usage. This is where implementing a continuous financial planning and analysis process will help increase flexibility and decrease the dependency on SaaS’ static model.
Secondly, SaaS might not offer all of the customized features that your enterprise is needing. If you want your processes and services to be handled in a single piece of software, it would be more realistic to look into custom software development. Custom software allows you to manage and use all of the features necessary for your business to run smoothly on your end, as well as your customers’.
Every company is different, which means those businesses have differing needs. Ultimately, software-as-a-service could become irrelevant in the future because enterprise-level businesses could rely on custom solutions to uphold their company. There would be no need for SaaS if that concept becomes reality.
What comes after SaaS seems to be consolidation and integration as companies try to simplify the tools they use.
Customized products set the top runners apart from the competition because the software is catered to your business’ needs as opposed to running your business around pre-built solutions.
If you’re searching for enterprise-level solutions from a Dallas-based digital agency and need made-from-scratch software that will uphold your unique business, Code Authority is the resource you’re looking for.
Contact us today for your free consultation regarding enterprise-level custom software for businesses!