Changes

==Background==

==Background==

Prior to the introduction of SaaS in the market, consumers purchase the software they need in different stores wherein every consumer pays upfront a certain amount for a software to be able to use it. Every software needs maintenance, support and upgrade which requires additional costs not just for the consumer but for the manufacturers as well.

Prior to the introduction of SaaS in the market, consumers purchased the software they needed at a given store; however, all software needs maintenance, support and upgrades, which means additional costs for the consumer and the manufacturers as well.

In the late 1990s, Application Software Providers (ASPs) found a way to deliver software applications more efficiently and to reduce the costs of upgrades by introducing an alternative to software on premise, the SaaS model. However, the first introduction of the SaaS model is faced with challenges since the number of users are not too many to access new functionality. The deployment of client/server software is difficult and the maintenance, support and upgrade requirements were still expensive because the method of delivery is not done through the internet.<ref>[http://www.computerworld.com/pdfs/Service-Now-BriefhistoryofSaaS.pdf Brief History of SaaS]</ref>

In the late 1990s, Application Software Providers (ASPs) found a way to deliver software applications more efficiently and to reduce the costs of upgrades by introducing an alternative to software on premise, the SaaS model. However, the initial introduction of the SaaS model was faced with challenges given the number of users and that the deployment of client/server software is difficult and the maintenance, support and upgrade requirements were still expensive because the method of delivery was not done through the Internet.<ref>[http://www.computerworld.com/pdfs/Service-Now-BriefhistoryofSaaS.pdf Brief History of SaaS]</ref>

Over the years companies improved the SaaS model using modern applications particularly the internet technology. For instance, [[SaleForce.com]], SaaS applications are multi-tenant. Multiple customers are able to use one application set and database. The cost of infrastructure and maintenance using is lower using Multi-tenancy applications thus consumers pay lesser for their software application subscription fees.

Over the years, companies improved the SaaS model using modern applications, particularly Internet technology. Thus, multiple customers are able to use one application set and database. The cost of infrastructure and maintenance were lowered using multi-tenancy applications and consequently consumers paid less for their software application subscription fees.

Based on the study conducted by IDC on SaaS, the revenue for SaaS will increase five times faster compared to the revenue of traditional packaged software by 2014 at $40.5 billion. According to IDC vice president of SaaS and Cloud Services research Robert Mahowald, "The SaaS model is becoming mainstream and it is quickly dominating the planning from R&D, to sales quotas, to partnering, channels and distribution of all software and services vendors.<ref>[http://www.idc.com/getdoc.jsp?containerId=prUS22431810 IDC Press Release]</ref>

Based on a study conducted by IDC on SaaS, the revenue for SaaS will increase five times faster compared to the revenue of traditional packaged software by 2014, to around $40.5 billion. According to IDC vice president of SaaS and Cloud Services, researcher Robert Mahowald, "The SaaS model is becoming mainstream and it is quickly dominating the planning from R&D, to sales quotas, to partnering, channels and distribution of all software and services vendors".<ref>[http://www.idc.com/getdoc.jsp?containerId=prUS22431810 IDC Press Release]</ref>

==Delivery Models for SaaS==

==Delivery Models for SaaS==