Guest Blog: Making Sense of ASP and SaaS Software Delivery Models

We at U.S. Healthtek enjoy a strong partnership with XIFIN, a progressive health information technology company. We are both committed to educating the community with real-world information that helps us all increase efficiencies and profitability. With that in mind, they have asked that we contribute to their blog from time to time. In return, we’re pleased to feature some of their excellent articles to our audience – lightly edited and annotated. Enjoy!

The difference between Application Service Provider (ASP) and Software-as-a-Service (SaaS) delivery models is significant, yet many people confuse the two because they are both “hosted.” It’s important to know that just because a solution is hosted, that doesn’t mean it provides the benefits of a SaaS solution.

In a SaaS model, a software application is comprised of a single, integrated code base that is delivered as a service to multiple customers simultaneously and securely, via the web. Additional capacity, add-on components, and new or upgraded features can be delivered to all customers simultaneously. In today’s medical lab environment, this is increasing not a luxury but a necessity. It’s increasingly demanded by the clients.

One of the most significant advantages of SaaS is that it is multi-tenant. Multi-tenant architecture lets multiple companies share the same instance of a technology solution while their specific data is securely partitioned from other companies. In an ASP, each company has its own instance of the software application and supporting infrastructure, which is much more inefficient and expensive than a multi-tenant solution.

The three biggest benefits for a multi-tenant solution are:

• Cost. With resource pooling, you save considerably in hardware. This is much more advantageous than a single tenancy – a separate physical or virtual machine – that needs to be set up for each and every customer.
• Upgrade Effort. What we find in the field is that multi-tenancy upgrades are practically seamless, as all customers are upgraded simultaneously. That new feature rollout? So much simpler with this than under an ASP. As soon as a bug fix, project, or enhancement is ready, it’s released.
• Backups and Redundancy. Creating redundancy for multi-tenancy deployments is easier and more efficient since the technical challenges are on one system rather than individual instances.

Clearly, the SaaS model is also nimbler in adapting to changes in the market. Other advantages of the SaaS model include:

• It’s always up-to-date
• It’s designed for the web, rather than adapted to it
• It’s more efficient and effective to support
• It typically provides higher service levels
• It’s easy to integrate with other SaaS systems

SaaS providers fully leverage economies of scale and reduce operational costs. At the same time, multi-tenancy enables SaaS providers to more easily share best practices and knowledge, and to quickly incorporate and disseminate improvements across a customer base. This directly affects the customers’ total cost of ownership in a positive way.

To dive deeper into the details of ASP and SaaS Software Delivery Models, U.S. HealthTek recommends downloading XIFIN’s excellent white paper on this topic, “Making Sense of ASP and SaaS Software Delivery Models.”