About the SaaS business model

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Umbrellar Connect

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cloud transformation SaaS

How does it work? How does it differ from other models?

Fun fact: 95% of strategic business leaders have adopted sophisticated Cloud services as the ever-growing influx of data continues to drive the modern business world.

The Software-as-a-Service model – or SaaS – has become mainstream as almost all industries move to make use of Cloud services. Even IT companies who once sold standard software are embracing the Cloud phenomenon.

SaaS is now the preferred business model, with more than 40% of the total public Cloud service revenue showing most enterprises are running their operations on it.

Alexandr Basan, Head of Product & Commerce at Umbrellar, states that companies use Microsoft services to offer their products on a subscription basis, unlike the traditional business models that were based on selling software licences. MyCSP is a SaaS solution helping to shift mentality from traditional business to a subscription-based model. So, what is the engine under the SaaS hood that is making even the biggest players adopt it?

SaaS – A quick history

When the internet first began, users accessed by signing up to an Internet Service Provider – an ISP. Some Citrix Partners spotted an opportunity to combine the internet with another technology – the Windows terminal servers. They became the first Application Service Providers – ASPs – and the first SaaS model was born.  Companies now had in-house systems, stored on a central server, to access the company data and applications.

Salesforce was the first leader to go ‘all in one SaaS’

SaaS has been gaining popularity ever since, and the types of SaaS have enhanced in creative diversity. Email, bookmarking and photosharing were some of the first apps used by consumers, but today customers can just as easily enjoy software for recruiting, billing and customer relationship management. Gartner picked the global SaaS end-user spending to reach $145M by 2022 – that’s double the revenue of PaaS and significantly more than IaaS.

Defining SaaS

Software as a service (SaaS) is a software licensing model enabling ready-to-use applications. Software is provided on a subscription basis, with users typically accessing through a cloud-based web browser.

SaaS is the most commonly utilised option for Cloud businesses, who use or deliver applications to their own customers, with the software mechanics managed by a Cloud Service Provider (CSP).

With configuration and upgrading covered, human resource, time and hardware costs are eliminated for customers.

Where SaaS and the Cloud intersect

There’s no doubt that as a software user, you’ve encountered issues such as software glitches, problems with usage or integration.

With SaaS, you receive the latest versions, support and automatic upgrades. You can test out features before purchase, and request specific customisations.  The beauty of SaaS lies in the provider taking responsibility for server requirements, leaving you as the customer to focus more truly on your own customers’ experience.

Cloud computing shapes value creation for enterprise software and associated business models. SaaS is often accessible through both a web interface, as well as in application-mode on computers and mobiles. Compared to the traditional model of software that requires users to pay high fees for upgrades, the cost of staying in tune and up with the latest is significantly lower with SaaS.

SaaS is different to IaaS and PaaS

Infrastructure as a Service is a fully self-service method of highly scalable and automated compute resources. Instead of having to buy hardware outright, businesses purchase resources on-demand and as-needed.

Platform as a Service provides Cloud components to software while being used mainly for applications. Developers use and build upon the PaaS framework to create customized applications.

Basan explains that SaaS continues to lead the market because it allows businesses to create intellectual property value in their specific areas and cultivate their entire customer experience.

“There are thousand of articles about the big difference between SaaS and IaaS, what to choose and why you should use one or another,” Basan says.

The talk is largely unnecessary though – “It’s cheaper, easier, less hassle to set up a SaaS entity than to build everything from scratch,” Basan advises. “While on rare occasions the flexibility offered in PaaS and IaaS is preferable, 99% of businesses don’t need it for their software.”

“You don’t have to worry about anything technical with SaaS. Hosting, platform maintenance, updates, security – all of those things are not what you have to worry about.”

Recreating the nature of work

There are some important capabilities available to the SaaS market. The list is extensive: workforce management, customer analytics and satisfaction, financial insights, automated result tracking, and Cloud integration expertise.

With SaaS, users get a common platform that allows them to easily manage everything from supply chains, customer communications and collaboration within the business and across partnerships.

At the basic level, software not on the Cloud is limited in its capabilities, and any form of information or business process sharing between vendor and participant ecosystems won’t be as fast or as cost-effective.

Best practices for SaaS – Be ready to embrace innovations!

Dependencies are part and parcel of SaaS. You’ll always rely on your providers to be up-to-date.

Many of our Partners offer their own bespoke and packaged SaaS systems. From data analytics to business processes – you’ll find a wealth of software offerings, each one serving a different purpose for your business need.

Umbrellar’s MyCSP platform is a curated pathway to the cloud. This award-winning SaaS digital commerce platform is specifically designed by Umbrellar to help Microsoft Cloud Solution Providers to save money AND grow as a business. Signing up with MyCSP allows you to offer your customers self-service of Microsoft Azure, Microsoft 365, Dynamics 365 and over 120,000 ISV solutions via your own white lable MyCSP Cloud Store.


MyCSP Demo - Microsoft CSP powered by Umbrellar - YouTube

Umbrellar’s MyCSP portal is an e-commerce engine that simplifies the Cloud management process

Basan explains how MyCSP has been a long-overdue change in industry’s Cloud usage:

“Historically it’s not simple to buy something from Microsoft through the CSP model – but MyCSP makes it simple. We save our partners and customers hundreds of hours of work by giving them a simple and easy system to purchase and manage products, optimise their billing, provide automation and add value on top of their services. We guide them through business paths and help them to save money every day.”

What is the future of SaaS?

In a world of advancing computer capability, the benefits of SaaS are by no means limited to process efficiencies. SaaS technology is omnipresent – increasing both operational and innovational benefits.

Overall, SaaS offers ease of access – and with that comes increased productivity. SaaS is becoming increasingly mission-critical, addressing issues such as customer churn and offering opportunities for partnership-based cross-selling practices.

Have you thought about how a move to the Cloud could benefit your business? Contact our team to find out more and explore the best Microsoft Azure solution for you. Join the Umbrellar Connect mailing list to stay updated on all the latest tech news as well as Microsoft Azure tips and tricks.

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