Home : Software Terms : SaaS Definition


Stands for "Software as a Service." SaaS is software that is deployed over the Internet rather than installed on a computer. It is often used for enterprise applications that are distributed to multiple users. SaaS applications typically run within a Web browser, which means users only need a compatible browser in order to access the software.

SaaS is considered part of cloud computing since the software is hosted on the Internet, or the "cloud." Because SaaS applications are accessed from a remote server rather than installed on individual machines, it is easy to maintain the software for multiple users. For example, when the remote software is updated, the client interface is also updated for all users. This eliminates incompatibilities between different software versions and allows vendors to make incremental updates without requiring software downloads. Additionally, users can save data to a central online location, which makes it easy to share files and collaborate on projects.

Several types of SaaS applications are available. For example, Google offers a suite of online applications called Google Apps. These include Google Docs, which allows users to create and share documents online, Google Sites, which enables users to collaborate on projects via a custom Web interface, and several other applications. Intuit offers online financial management software through Mint.com and provides tax software via TurboTax online. Microsoft's Windows Live service provides Web versions of Microsoft Office programs, such as Word, Excel, and PowerPoint. Documents created with the online Office applications can be saved on a user's SkyDrive and shared with other Windows Live users. SaaS is also common in the medical field, where doctors use online software to save, update, and share patient records.

Some SaaS software is free to use, while other online programs require an upfront payment or a monthly fee. Enterprise SaaS applications often require a commercial license, but online software licenses are usually less expensive than individual software licenses. Because of the many benefits of SaaS, it is becoming an increasingly common way to distribute software.

Updated: January 31, 2011

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