Pricing Saas Models: Perceptions Of Business Service Providers And Clients | Mary Mathew & Sumesh Nair

The paradigm shift in delivery of software applications from a shrink wrapped / licensed form to a more end- user friendly ‘service’ was fuelled by the opportunity that the Small and Medium size Businesses (SMBs) created. It created a way to deliver the existing software applications to new markets or serve existing markets in a new cost effective way. The bottom line being, customers who do not have the expertise or capital budget to purchase, install, and manage applications, can subscribe to hosted services for a recurring fee. This model came as a fresh dose of energy to an otherwise matured model, but brought with it a lot of complexities which a service provider will have to address. Key concerns include pricing of such pay-per-use models. The paper has attempted to address the concerns of the service provider, while pricing such services, by delving deep into their internal perceptions as well as extraneous intended end -user perceptions.