Do You Need a SaaS Hosting Provider?

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The Software-as-a-Service (SaaS) delivery model is undoubtedly changing the way software vendors sell and market their software. While many vendors understand what it means to host an application and provide it to customers via the Web, few fully recognize the transformational elements that are necessary to fully and successfully implement their SaaS offering.

A SaaS hosting provider is the foundation to meeting your specific SaaS needs. The right host is one that has expertise in running a standard, global enterprise infrastructure, as well as new, cutting-edge features -- such as end-to-end software development capabilities and cloud-based platforms -- to enable fast, economical and reliable deployment of your SaaS applications. Additionally, they can also provide advisory and consultative services that will be essential as you continue to strategically grow your SaaS offering.

How do you know if you need a SaaS hosting provider? What are the characteristics of a reputable SaaS hosting company? The following considerations will help you determine when to turn your SaaS infrastructure over to a managed hosting service and how to find the best host to meet your unique SaaS needs.

  • You do not have the necessary resources available to quickly and cost-effectively implement SaaS

SaaS has made it easier and more cost-effective to create, distribute and manage software; however, software vendors looking to adopt a SaaS delivery model must ensure they can still meet their customers' availability and security demands. This necessitates a secure, reliable, enterprise-grade infrastructure that can support and quickly scale to host the vendor's growing number of Web-based software applications.

To do this, many rely on SaaS hosting providers. The SaaS hosting provider you select to host and manage your SaaS offering should have a reputation for successfully implementing hosted services. They also must be focused on addressing specific SaaS requirements, including capacity planning, compliance, visibility and new technology integration. In short, SaaS should be a natural extension of the host's core business and expertise, not just a loose grouping of services packaged together to capitalize on the SaaS trend.

  • You find it harder to differentiate your SaaS offering in the marketplace

The early days of SaaS were plagued by system downtime and potential security flaws. A high-performing, reliable technology infrastructure often distinguished the leading software vendor from its competitors. Today, managed hosting providers have arrived at effective processes to develop, deliver and refine many of the essential enabling elements of SaaS, including consistent uptime, SLAs, scalability, and rapid system response time. Although these factors are still critically important to a reliable SaaS offering, they no longer create significant differentiation among software vendors.

A SaaS hosting provider that offers consultative assessment services in addition to reliably operating a SaaS infrastructure is essential to helping facilitate a transition to a SaaS model. A SaaS hosting provider should demonstrate a willingness to help you grow your business, which includes assisting with a go-to-market strategy and providing access to global markets. The right SaaS hosting provider can also help extend your brand by offering additional avenues for growth, such as collaborating with you to create clearly differentiated solutions, developing services that increase marketing and integration options, and granting access to their customer base, giving you greater exposure to new prospects.

  • Your customers request more than just basic SaaS functionality

Customer demands for improved SaaS functionality continue to evolve beyond consistent uptime, rapid system response time and broader solution capabilities. Next-generation functionality, improved internal and external collaboration, and other leading-edge technologies are now expected as part of any SaaS solution. Vendors may be capable of temporarily supporting these new features, but the required modifications needed to adapt to the rapid rate of change in the SaaS space can make it difficult to keep pace with the technology. One of the key factors enabling these major and rapid changes is the strength of your SaaS hosting provider.

As you develop your SaaS offering, you should regularly evaluate whether your SaaS hosting provider has the physical and technical resources to anticipate and address future SaaS delivery challenges that your business could face. Additionally, the provider should understand how to package, price and promote profitable managed services. Selecting a hosting company that has established credibility in running a standard global enterprise infrastructure is essential to ensuring smooth and successful transitions as SaaS requirements and features change.

  • You spend more time managing your SaaS infrastructure instead of developing software applications

Ideally, software vendors want talent and resources focused on their "core," or the projects and activities that create differentiation for them and result in more revenue, market share and margins. In reality, however, vendors spend an unnecessary amount of time maintaining and enhancing network capacity and support, security, storage, backup, and disaster recovery. These capabilities, known as "context," are required and essential, but they provide no additional value to you or your customers. Further, they can detract from your "core."

Finding a trusted, highly capable SaaS hosting provider will help to free you from the responsibility of managing your SaaS solution and enable you to focus on software development to create greater value for your customers. Your SaaS host should have ownership over essential, high-quality SaaS assets, including data center facilities, networks and other IT components. Additionally, they should be able to demonstrate that they have established vendor relationships and service agreements already in place, offer performance SLA monitoring to cover critical elements of service -- from network performance to response times -- and provide comprehensive security credentials. The ideal hosting candidate should also have a professional services team and 24/7 reliable and dedicated support to assist with any technical issues.


As SaaS continues to proliferate, software vendors are adopting this new delivery model to satisfy their customers and maintain a strong competitive market lead. As decisions around how to implement the most appropriate SaaS solution become more complex, vendors may find it difficult to determine a strategic and cost-effective path forward. In these cases, a SaaS hosting provider can help vendors address their business, marketplace and technical needs; however, not all managed hosting providers have the infrastructure or expertise to support the SaaS model. Therefore, it is important to select a host that offers more than just technical capabilities. End-to-end software development ecosystems, cloud-based platforms and advisory services are also critical components that vendors should consider as they 'SaaS-ify' their offerings and create new value for end-users.

About the Author

Larry Steele brings more than 18 years of experience in technology to his role as vice president of SaaS for SAVVIS Inc. Steele leads the overall global strategy in delivering SaaS solutions to meet client needs. Prior to joining SAVVIS, he was the CTO for Edward Jones, a leader in the financial services industry. He holds an MBA from Washington University, St. Louis. He is also a frequent participant in CTO advisory boards and industry speaking events.

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