Software as a Service (SaaS)

In its 2011 definition of cloud computing, the US National Institute of Standards and Technology (NIST) describes SaaS as using a provider's applications running on a cloud infrastructure. The customer controls neither the network nor the servers, operating systems or storage. It uses the application and at most adjusts settings.

For businesses, this means: you usually pay per user per month or year, and the vendor takes care of operation, updates and availability. Typical examples are team chat, CRM, accounting and project management.

Because the data sits with the vendor, SaaS almost always involves processing on behalf under the GDPR. You then need a data processing agreement. Data location, data export and notice periods also matter. Our SaaS selection checklist shows what to look for.

SaaS differs from Infrastructure as a Service (IaaS) and Platform as a Service (PaaS). With those, you rent computing power or a development platform and run the application yourself. With SaaS, the vendor also runs the application.