Software as a service (SaaS) is a software application delivery model where a software vendor develops a web-native software application and hosts and operates (either independently or through a third-party) the application for use by its customers over the Internet. Customers do not pay for owning the software itself but rather for using it on a subscription basis. They use it through an API accessible over the Web and often written using Web Services or REST. The term SaaS has become the industry preferred term, generally replacing the earlier terms Application Service Provider (ASP), On-Demand and "Utility computing" (from Wikipedia).
SASIT has been operating on the SaaS principle since 1981 (initially using leased lines, before transitioning to the Internet). Customers typically pay a monthly fee for use of software, disk space, CPU seconds, backups, helpdesk etc on the basis of a packaged outcome.
One of the most successful SaaS sites today is the SalesForce.com model for the delivery of CRM based applications. One of the most successful New Zealand SaaS models built to date is the Sonar6 model for delivery of people management applications.
