With the recent success of SalesForce.com, more and more businesses are getting comfortable with the concept of software as service. In case you are not familiar, software as service is a software delivery model in which the software company hosts a web-application and provides the software application for use by its customers over the Internet.
However, there is an old saying – one size doesn’t fit all. So, is software as service right for your business? Let’s take a look at various pros and cons of software as service and let you decide for yourself if it is right for you and your business.
Pros of Software as Service
No Infrastructure Costs. When you are buying software as service, you have no need to invest in server infrastructure, software licenses and hiring and training people to manage this infrastructure. All of this is taken care of by the company which is providing you software as service.
Predictable Monthly Fees. Most of the companies offering software as service charge for their services either by the number of users or by the amount of usage you do. This makes it extremely easy for companies using software as service to predict their monthly fees.
Pay only for what you use. When you are using self-hosted software, you have to buy a fixed number of licenses and there is no way you can return them if you donâ€™t need them anymore. TO make matter worse, software companies try to motivate you to buy more licenses by offering you special deals for bulk purchases, just in case you expand and need them in future.
With software as service, this problem does not exist. You pay only for what you use and you can up-scale or down-scale as the requirement arises. If people leave your company, you will no longer be left with software licenses you have no use for.
No Maintenance Required. The company which is providing you the hosted software takes care of the system maintenance, upgrading to latest version, implementing security patches and data backup. You do not have to worry about doing all of this yourself as you would with self-hosted software.
Less Cost of Training and support. Since the software is managed by a third-party, you no longer have the requirement of hiring and training technical staff to manage the software and the associated infrastructure. Furthermore, training and technical support for end users is provided by the service provider providing software as service.
Instant Setup. With hosted software you can usually be up and running as soon as you register an account with the company. However, with self-hosted software, you will have to first setup the infrastructure, install the software, test it and then roll it out for production use.
Cons of Software as Service
Even though software as service model has some major advantages as we noted above, however, it is not without its share of issues. Let’s take a look at some of those.
Monthly costs can add up. While there is no question that for small-scale deployment software as service is an extremely cost efficient way to save on initial infrastructure and licensing costs, however, as your company starts to grow, the monthly fees can add-up to a sizable amount.
If you plan to do a large scale deployment, there can be a huge cost saving by going in for self-hosted software. So that is something you need to consider when you are deciding between self-hosted software and hosted software.
Customization is not possible. One big issue with most software as services is that you can’t write proprietary code or add-ons to customize the software according to your requirements. However, this is very much possible to be done with self-hosted software and companies sell a fair amount of money and effort doing it.
Additional Features Cost More. If you require additional features or storage capacity, you have to pay more or upgrade to a larger plan. And these are usually recurring costs.
Reliability of Services. The infrastructure that the software runs on is managed by the service provider and you have no control over the kind of configuration they choose to run.
While chances are that the quality of infrastructure they are using may be of much higher quality and have more redundancy than what you can afford yourself, but still, there are some chances that the service will go down because of technical issues.
Stability of Service Provider. Another big dilemma which a lot of companies face is that if the service provider closes down the shop tomorrow then what happens to your data and business operations.
For this reason, you have to ensure that before you use software as service that you have enough safeguards in place to make sure that you can switch over to an alternative just in case something happens to the company providing you the service.
By knowing the pros and cons of software as service you are now in a position to decide if it is something that is well suited for your business requirements.