According to Gartner, a global IT research firm, the annual cost to own and manage software applications can be up to four times the cost of the initial purchase. As a result, companies end up spending more than 75% of their total IT budget just on maintaining and running existing systems and software infrastructure.1 With the introduction of computers, companies have accepted this as a cost of doing business. The number of software applications that a company may need are infinite. The resources to operate these applications however are finite.

The Software-as-a-Service (SaaS) revolution allows companies to subscribe to software applications and outsource operating the back-end infrastructure to the SaaS vendor. In most cases, the SaaS vendor can do this much more cost effective; providing overall cost savings for the company. As a result, companies can spread their IT budget across many more applications to support and grow their business operations which will in turn contribute to the bottom line.

This document educates end-users and decision makers on Software-as-a-Service (SaaS), where it differs from traditional software, and what the key benefits are when deploying SaaS applications. In addition, this document also provides the reader with a comprehensive look at the Total Cost of Ownership (TCO) analysis any decision maker should complete before making a choice between a SaaS or a traditional software deployment.