I think, ASP is an older term. Today most of the companies moving towards SaaS definition. It incudes definition of multi tenancy. Best, Oleg

Still getting a little confused. I think at the end, both of them are more or less the same.

Thanks for this detailed post

Very well put! I’ve battled to articulate the differences before, and I think that the fundamental differences in flexibility vs cost is the kicker.

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Then what is the diff between SaaS and Cloud models?

Good article. The difference between the two is clear.

I agree with Oleg. The term “ASP” reflects a model that did not succeed. “SaaS” is a come back when costs of storage and bandwidth are lower, security and web technologies are more advanced, comparing to ASP time.

I liked the explanation, It cleared the concepts to me. Nevertheless what is a difference between private cloud and ASP?

When the rigidity in SaaS shall have been addressed, the difference will be the same.

I think there isn’t much difference between the both. It is a matter of articulation based on where you want to lay emphasis on. SaaS vendors do have models where they offer single tenancy (sometimes, they call it Platform as a Service and charge you for both platform and application maintenance).
More than anything else, SaaS is part of new business model which came into existence after ASP model. Moreover, SaaS is just one of the new models - there are several of them offered ‘as a service’. ASP is obsolete in that sense and we may not talk about that at all in future.

Assuming the Saas provider has a solid product, incorporating industry-specific best practices in their application(s), and an organization believes in / wants to follow best practices, there is less of a need to configure. Therefore SaaS will do the job. Those that legitimately need / want congifurability or customization (and can afford it - upfront and ongoing) have options including in-house, ASP, etc.

Both models have a place.

The ASP model will serve for those applications that require specific configurations and where data security is key. Many companies view their specific deployment of computer technologies (HW,SW and database) as part of their secret sauce (competitve advantage). Only someone that is competely out of touch with business realities would suggest that, two manufacturers of bikes, for example, can or should use precisely the same configuration of technologies for their respective businesses. To do this each of the manufacturers would have to forego all future possibilities of achieving a competitive advantage through thier implementation of computer technologies (a prime source of increasing productivity).

SaaS, on the other hand is ideally suited for the common apps and technologies that we all use everyday, like MS Office. The only perception that will have to be addressed is data security. While we may all use a spreadsheet the same way, its contents are very likely to be confidential, at a minimum.

While most ASP vendors were single tenant and most SaaS vendors are multi-tenant, there are plenty of exceptions. Significant differences include:
-ASP vendors frequently built all their own infrastructure, spending much of their money on this capital investment; SaaS vendors often partner with infrastructure vendors and focus on creating and supporting their application.
-ASP vendors didn’t understand the available pricing and marketing models and couldn’t make a business out of what they were trying to do. Successful SaaS vendors generally understand marketing costs and pricing models.

I think this is a good blog and very factual and informative - but one small part of it I’ve heard a lot and think it’s kind of the old way of thinking.

You mentioned: “On the flip side, while ASP customers have total control over configuration, in SaaS applications clients have only limited possibilities for customization features.”

It’s inferred as a positive for ASP or on-premise. But in fact it’s flawed in 2 respects:

1. In the cloud/SaaS world we have on-line communities and other sources to express ideas and innovation. And because of the model you describe above, innovation happens easier and quicker in the Cloud. I’d rather have thousands of people recommending enhancements I find useful now that I may never discover until well into the future. And with SaaS, the enhancements have a better chance of being delivered.

2. As you know, with customizations on on-premise or ASP - you’re stuck with that version now and hope you can keep the consultant that did the work close at hand. If I really need work done that is so specific to me -I’d rather use a SaaS/Cloud company’s API.

To sum up - I just think claiming customizations for on-prem or ASP as a positive - is way outdated. I think most people blogging about this put customizations as a positive just so ASP/On-premise has something there.

First of all, thank you for your comments, and sorry for the late response,

Suraj and Gautham:

In a way, both models offer a similar type of service for the end user, the possibility to work remotely with an application. But in the computing architecture there are differences that give them special features to each of them. Maybe you may want to send more specific questions our “Ask the experts” section. We will be pleased to answer your specific doubts.

Oleg and Phil
I agree with you that ASPs are older than SaaS provider, but not completely extinct. I still think that this model will work for some time because some businesses still have very particular business models that prevent them to move to a SaaS solution. But also, like Phil mentioned, some organizations can choose from more cloud based options besides SaaS, like Platform as a Service (PaaS) or Infrastructure as a Service (IaaS) models. What I do believe is that we will have a mixture of options for a while, even on-premise solutions, because moving to a new computing model is not only a technological decision it is mostly a business decision, so many factors need to collide when making the choice for any of them.

Saba
Simply put, the SaaS model is part of a cloud architecture model. please take a look to an article I’m published previously about cloud computing, http://www.technologyevaluation.com/research/articles/a-tour-of-the-clouds-21076/
or
http://blogs.pcmag.com/miller/2010/07/the_changing_cloud_platforms.php

I hope this would help you clarify the difference between both models.

Glen and Eric
I agree, currently we have existing SaaS providers that can make the job. Also, as any other technology, it’s evolving and adapting to new conditions and needs, as an example, SaaS provider used to be consider solutions to fit in the medium and small sector, but we are seeing that large companies are right now using several SaaS solutions. My two cents are that is a matter of evaluating which type of solution will be the fit for our organization. Sometimes we need to think in terms of what is best for us and not in terms of what we must, according to someone else.

Amy
Thank you for your comment, I’ve certainly did not address the difference regarding the business model.

Jim
Thank you also for your comment, my intention was not to infer any a positive or negative opinion in regard of the ASP or SaaS model, but just to establish a clear difference between them. Maybe you will agree with me that the most difficult part of applying a new software solution is to reach the balance between many factors to obtain the most benefit of that software solution. While for some companies having control is essential, for some other it is not a critical factor. My take is that options are there and we have to be aware regarding benefits and drawbacks of each model. I do believe that we will be encountering more mixed type solutions to fit very specific types of needs. Bu I still think that even nowadays, some companies will have to look for other solutions that are not necessarily SaaS.

Ricardo
I will prepare something for your question, but in the meantime, please read the following:

http://blogs.gartner.com/thomas_bittman/2009/02/05/private-cloud-computing-is-real-get-over-it/

http://www.technologyevaluation.com/research/articles/a-tour-of-the-clouds-21076/

Thanks also to Nitin, Rafael, Wale Ajala and Dan

Of course, I’m far from being the last word on the matter, so please let me know your additional thoughts, throw your tomatoes in this same place, or let’s connect in twitter at

Jorge Garcia
http://twitter.com/jgptec
:-)

Nice explaination. Knew the concepts already but still good to read.

[…] to take a deeper look. The following article came to my attention couple of weeks ago – Ask the Experts: What’s the Difference between ASP and SaaS? In my view, it provides good arguments to both of these models: ASP and SaaS. The following two […]

[…] to take a deeper look. The following article came to my attention couple of weeks ago – Ask the Experts: What’s the Difference between ASP and SaaS? In my view, it provides good arguments to both of these models: ASP and SaaS. The following two […]

Call me dumb, but the way I see this is that the ASP model in my thinking alone, is far superior becayse there is far far less of a bottleneck in this regard !!!

If each user request opens an individual and dedicated singular instance of the software in question, thyis to me is far far more appealing then been any part of a model in whihc the aplication is being shared by any nuymber of multiple users.

I ama rookie, and maybe that means I am not seeing all of this correctly, but maybe it also means I am seeing something quite simple in it’s nature here that everyone else seems to have missed or skipped over.

The ASP model just looks vastly superior to me !!!

I really have a tendency to go along with all the things that ended up being written within “Ask
the Experts: What’s the Difference between ASP and SaaS?
? The TEC Blog” lehelmakara.com .
Thank you for all the facts.Thanks a lot-Barrett