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SaaS: Different Flavors of On-Demand, but does it matter?
A clear advantage of SaaS is its simplicity. There’s no need to really know what’s going on underneath the hood. With traditional software, if the core technology is in .Net, Java, ABAP, ColdFusion, or whatever, any kind of in-house customization will require IT staff members to be familiar with the technology. The same is true, and even more so, in the case of the database technology that is used by the application, where it is often necessary to have in-house database expertise to help install and support the application. Because of that, often the technology of the selected application is a key factor in deciding whether or not to select an application.
That said, it is surprising how much debate there is over the topic of multi-tenancy and multi-instance on-Demand hosting. The customer never can tell which technique is being used. Companies like Salesforce.com, Microsoft, Netsuite and RightNow use multi-tenancy. SugarCRM and SAP are using the multi-instance approach.
Multi-tenancy is often favored by vendors because it has a lower demand on total resources. Resources are centralized to a single data center and scalability is achieved using techniques like mirroring and clustering of the database instance and application server. Multi-tenancy typically is considered to be much easier to administer than multi-instance.
Multi-instance hosting has benefits too. Stringing together low-cost commodity hardware can be considerably cheaper than more expensive big-brawn central servers.
“None of us do [SaaS] in exactly the same way. We use different architectures,” Oracle president Charles Phillips said. “Multi-tenancy has nothing to do with on-demand. [It is] a convenience for the vendor. Whether they put all customer data onto one database or onto multiple databases is of no value to the customer. In the enterprise it is the opposite. They do not want to put all their data [into the same database] as their competitors. It is illegal in some industries.”
