SaaS builds on service models such as Infrastructure as a Service (IaaS) and Platform as a Service (PaaS).
SaaS is commonly known as the third type of cloud services. It abstracts the hardware and platform for the end user and is represented by a web application that the user can access at any time and from anywhere in the world. The software runs on the provider's infrastructure and the platform is tailored to the needs of the software. The end user does not have to deal with technical requirements here because everything is handled by the service provider. The underlying infrastructure can either be hosted in a data center of the SaaS provider or even on the platforms of PaaS or IaaS third-party providers. End users could customize the web-based software specifically to their needs. The user only pays for services they actually use.
The benefits of SaaS are easy to see for both sides; end users benefit from high accessibility, data sharing, collaboration features and secure data storage. Service providers, on the other hand, benefit from easy software installation and maintenance, rolling out and testing new software modules with select user groups, and centralized control over active versions. Cloud computing did not give rise to this type of offering, as "software as a service" was available long before. The basic requirements for SaaS are accessibility and fast Internet connections, which have become more widespread in recent years and have ultimately led to a higher demand for cloud solutions, which is now being met by more and more providers. The fact that today SaaS providers no longer need to host their own data centers to offer their services, combined with the ability to develop offerings directly on third-party infrastructure, has drastically reduced investment costs.