What's in a Name: Is 'SaaS' Really New?

To those who knew ASPs, 'software as a service' seems all too familiar.


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Posted November 2, 2007

Matt Villano

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It was Juliet Capulet in Shakespeare’s “Romeo and Juliet” who uttered the famous question “What’s in a name?” in her biting commentary on names as meaningless conventions.

If only she were around to comment on IT services: What would fair Juliet say about the evolution of Software as a Service?

That’s right, SaaS, that software application delivery model where a software vendor develops a Web-native software application and hosts and operates it for use by customers over the Internet. The moniker (for you grammarians, technically it’s a “camelback acronym”) came in to widespread use after a conference in 2005.

But some vendors and experts alike say the model has been around for decades under a different name: Application Service Provider, or ASP.

Remember the ASP? The software model coined the notion of delivering computer-based services to customers over a network. It emerged out of service bureaus of the 1970s and 1980s, fueled the dot-com boom of the 1990s, and largely was blamed for the dot-com bust of Y2K.

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Now, at least according to some, it’s back, only with a different name. What in the name of guerilla marketing gives?

That depends on whom you ask. Some say SaaS is nothing more than a marketing ploy to repurpose the ASP model under a different, less controversial name. Others admit that while the SaaS and ASP models once were cut from the same cloth, SaaS is a new-and-improved version, ASP 2.0, if you will.

Oli Thordarson, president and CEO of Alvaka Networks, a managed service provider in Irvine, Calif., is a critic.

“We don’t call Splenda ‘saccharin’ after saccharin was found to be cancer-causing,” Thordarson says. “People latch on to names, and ASPs got such a bad rap in the 1990s that I don’t think anyone would go near it if you brought back the name ‘ASP’ today.”

Mike Masnick, CEO of Techdirt, a technology analyst firm in Sunnyvale, Calif., agrees, going so far as to say that he doesn’t see any “major” differences between the two at all. “Sure, the technology has changed a bit, but when you look at functionality, they’re identical,” Masnick says. “It’s a classic example of marketing a newer version of the same thing to avoid negative reaction from those who might have been turned off previously.”

Others have a different perspective. David Sockol, for instance, CEO of Emagined Security, a managed service provider in San Carlos, Calif., says he prefers to think of SaaS as a dramatic evolution of the ASP model, the same idea only better.

“When ASPs were first designed, they were mostly people using the Web to interface with backend software,” he says. “By allowing organizations to put software on their machines that interfaced over the Internet with backend processes, SaaS takes this another step.”

According to Sockol, the primary differences between SaaS of today and ASP of yesteryear are in where the native business data resides and how much control (in terms of application software licensing, possible system failures and security breaches) the native business has.

Under the ASP model, he says, customers really never really had much code running locally – all of it was running off of a server or other engine at the host. Under the SaaS model, however, customers have the code conveniently sitting on their networks in the form of application programming interface (API), which communicates with a host server remotely.

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Tags: services, Microsoft, DRM, SaaS, marketing

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