In the majority of computer systems, the applications and data reside within a local computer. The conventional method of software delivery is whereby a consumer purchases software on a disk or downloads it over the internet then installs it on a local computer. In recent years a new computing model has emerged where end users do not install software on their computers (or server computer) but run it and store data on an third party computer through a network.
This computing model is called cloud computing. As a result of cloud computing a software revenues model where a customer uses a firm’s software and data services over a network has emerged. This model is known as Software as a Service (SaaS). This essay will examine the definition, history, pros and cons, the current state and the likely future trend of Software as a Service and Cloud computing.
What is cloud computing? Cloud computing is a relatively new term which does not have a clear and strict definition, especially when used in different contexts. It can be defined as the management and provision of applications, information and data as a service provided through the internet. The word cloud probably emerged as representation of the virtual location of the system. According to Sun (n.d), what distinguishes cloud computing from previous models of computing is the fact that it involves the use of information technology as a service over the network (p. 1). According toTarget.com (n.d), SaaS is a method of providing software not as a product but as a service over a computer network where clients pay for the data and computational services mainly at a time based rate or on consumption based rate (para. 1-3).
How does cloud computing work? The basic infrastructure consists of local terminals (e.g. personal computers, ‘smart’ phones and laptops), a network infrastructure (hardware and software) and remote servers. The client PCs are connected to virtual servers via a network usually the internet. The terminals may have low specifications (memory size, processor speed and storage) since data processing and storage is done externally.
Through these terminals, the users access the data and the processing services from the remote servers over the internet. Cloud computing incorporates several things, including; virtual computing, on-demand deployment, internet delivery of services and at times, open source software (sun, n.d, chap. 2).
What is the history of Cloud Computing and software provision as a service? The idea was born after the invention of the internet and different experts accredit the origin of the idea to different persons. However, significant development began in the mid 1990s after the rapid growth of the internet and due to developments in software and hardware. According to Mohamed, in 1999, the website Salesforce.com was a major leader in SaaS by offering business software services on the web.
Cloud services that followed were mainly used for critical business applications. The enterprises that offer Cloud computing services or SaaS are commonly known as cloud venders. Most of the vendors have been large companies such as Google which has Picasa (a photo storage service) and Google docs, Amazon which offers Amazon Mechanical Turk and IBM. Other major companies that are involved in cloud computing solution include; EMC Net Apps, Microsoft and Yahoo (Velte, Velte & Espenpeter, 2010 pg.41-44).
Currently, a number of specialist small and medium companies are also offering SaaS. For example Osprey, a company in the UK that offers information management software to law firms, is currently offering its Information Management System as a cloud based service (Osprey, n.d para. 2). Cloud based services are also being offered for consumer services such as photo storage (Google Picasa) and document processing (Microsoft cloud based Office 2010).
The vendors have been and are currently addressing a number of issues. One major issue is security. Cloud systems are faced by significantly higher security threats than conventional systems because they are accessed over the internet. These include; hackers, viruses, hardware damage and insider attacks. Since data and information systems are valuable, for customers to embrace SaaS, they need to feel that security concerns have been adequately addressed. Another huddle to the development of SaaS is the reluctance of consumers to change from conventional systems.
Cloud computing is a model with great potential both economic potential and potential to be the dominant computing model. According to Gartner “Cloud computing will be as influential as E-business“(2008, para. 1). In the future we will have Software and data storage services being available to a larger proportion of the general population. Secondly more cloud services are likely to be offered through mobile phones (‘smart’ phones). A number of factors are facilitating and will facilitate the growth of cloud computing. One, currently an increasingly large number of people is using mobile devices (mobile phones, tablets, laptops etcetera) to carry out transactions via the internet.
Secondly, the security concerns of data and information systems are being addressed. Some Cloud computing proponents claim that data and application programmes are safer on a cloud than on a local personal computer or on the company intranet. This is because the level of security measures applied to cloud systems is very high. Thirdly, consumers currently have access to higher bandwidth (internet transmission space). Fourthly, more enterprises will offer SaaS due to factors such as the need to obtain a competitive advantage, increased system requirements by new software etcetera.
Finally, the cost of cloud based services will fall and consumers will be presented with better service packages. This type of service will have several implications. For example, devices/terminals will have minimal resources (data, processing power and programmes). Also, the security of data and applications will be separated from the security of the terminal device.
SaaS, like any technology model, has its pros and cons. One advantage that it provides is lower costs. In some SaaS packages the consumer pays for the service on a per use basis, therefore if the consumer only uses the services occasionally they pay lower fees. Thus customers can access to expensive software that they previously could not. Another advantage is that it provides customers with scalable service whereby they can access increased computational services at any time. With SaaS you get better support services (Guerino, 2007). These include, software updates, training assistance, fixing defects and back-up recovery.
On the other hand, the SaaS model requires that the client must have internet access. Another disadvantage is that it hands the security responsibility to a third party which may give the end user a feeling of loss of control. Finally SaaS services may not meet the specific software needs of an enterprise (Online-crm.com p. 1).
Cloud computing and SaaS models are new models and have been developing gradually. Initially cloud computing was used for critical applications. Currently, the cloud services are being offered to ordinary consumers but the level of market penetration is still relatively low. Medium sized software firms have begun offering software as a service. In future, due to a number of factors, it appears that a large number of consumers will be using cloud based software and data services. Experts also claim that cloud computing will be a major computing model in the future.
Gartner. Gartner says cloud computing will be as influential as E-business. 2008. Web.
Guerino, F. SaaS 101: What managers need to know. 2007. Web.
Mohamed, A. A history of cloud computing. 2007. Web.
Osprey. “Benefits of Osprey.TM.” n.d. Web.
Sun. Introduction to cloud computing architecture, 1st edition. n.d. Web.
Techtarget.com. Definitions: Software as a Service. n.d. Web.
Online-crm.com. The realities of CRM SaaS – advantages and disadvantages. n.d. Web.
Velte, A.T, Velte, J.P & Elsenpeter, R. (2010). Cloud computing a practical approach. New York; McGraw-Hill.