SaaS, or Software as a Service, is a software delivery model in which applications are hosted by the vendor and accessed by customers over the internet, typically on a subscription basis, rather than installed and maintained on the customer's own infrastructure. Microsoft 365 and Business Central are both delivered as SaaS, with Microsoft handling hosting, updates and infrastructure maintenance as part of the subscription.
How SaaS works
With SaaS, the software vendor hosts the application, typically on cloud infrastructure such as Microsoft Azure, and customers access it via a web browser or dedicated app, paying a recurring subscription fee usually based on the number of users. The vendor is responsible for maintaining the underlying infrastructure, applying updates and ensuring availability, removing this burden from the customer's own IT team compared to traditionally installed, self-hosted software.
SaaS in practice for UK businesses
- A business subscribes to Microsoft 365 on a per-user monthly basis, avoiding the upfront cost of purchasing and installing traditional office software licences.
- A company adopts Business Central as SaaS ERP, benefiting from automatic twice-yearly updates managed entirely by Microsoft.
- A growing business scales its SaaS subscriptions up easily as headcount increases, adding licences without the lead time of procuring and installing new on-premises software.
- An IT manager values that SaaS applications are accessible from any device with an internet connection, supporting flexible and remote working without complex VPN setup.
How Advantage helps businesses adopt SaaS
Advantage implements and manages SaaS Microsoft products including Microsoft 365, Business Central and Dynamics 365 for UK SMEs, helping businesses make the most of the subscription model's flexibility and reduced infrastructure burden.
Frequently Asked Questions
What is the difference between SaaS and traditional software licensing?
Traditional software licensing typically involves a one-off purchase of a perpetual licence, installed on a business's own hardware, with the business responsible for maintenance and updates. SaaS is subscription-based, hosted by the vendor, and includes ongoing updates and maintenance as part of the subscription fee.
Are Microsoft 365 and Business Central examples of SaaS?
Yes. Both are delivered as SaaS, with Microsoft hosting and maintaining the underlying infrastructure and applications, while customers access them via subscription on a per-user, per-month basis rather than purchasing and installing software themselves.
What are the main advantages of SaaS for SMEs?
Key advantages include lower upfront cost compared to purchasing perpetual licences and hardware, automatic updates without IT having to manage the process, accessibility from any device with an internet connection, and the ability to scale licence numbers up or down as the business changes.
