SaaS vendors have generated considerable business for managed hosting service providers in recent years.

John Moore

October 24, 2012

3 Min Read
Managed Hosting Advice: Navigating the Needs of SaaS Clients


SaaS vendors have generated considerable business for managed hosting service providers in recent years. Back in 2009, Savvis identified SaaS as important for the company’s growth, while other MSPs such as Sungard also cultivated SaaS providers as customers. Pure play SaaS providers and startups looking for infrastructure have fueled demand. But so too have traditional on-premise vendors looking to adopt the SaaS deployment model. Bobby Boughton, director of account management at Hostway Corp., a managed hosting and cloud hosting company, said software companies new to SaaS will encounter a vastly different set of infrastructure requirements compared with traditional software delivery.

A software vendor that makes its products available via FTP transfer doesn’t need  particularly robust infrastructure — a fairly simple environment with a content delivery network attached to it will serve the purpose, Boughton said.

SaaS apps — which need to deal with simultaneous users — require a different backend, however.

“The infrastructure that goes with SaaS is very different,” Boughton said.

Here is Boughton’s take on meeting the needs of SaaS customers:

Find the right mix of cloud and dedicated resources

Boughton said the public cloud can address a good portion of customers’ infrastructure needs. But he noted that a hybrid approach that lets SaaS providers tap dedicated resources — as well as cloud-based resources — may prove the best solution.

He said SaaS vendors that have a lot of data or need high performance in their database and data storage tiers “would be better served by running those components in a dedicated environment that has the capability of connecting to their public cloud front end.”

Web and app servers, meanwhile, could run in the public cloud.

Provide infrastructure to suit a customer’s specific needs versus offering a pre-packaged solution

Boughton said SaaS vendors don’t typically fit into any particular, predictable pattern when it comes to infrastructure requirements. There’s no formula for how many web, app and database servers they will need.

“Every SaaS app I’ve seen is unique and has a completely different set of requirements,” Boughton said, noting that some apps are extremely dependent on database input/output operations per second (IOPS), for example. “It’s hard to put in a cookie-cutter solution.”

Bring in additional resources when needed

Boughton said Hostway works with third-party partners who provide various products and services. He cited load testing as one example. A Hostway testing partner will write test scripts and put apps through simulated workflow scenarios.

Selling Points

Trying to sell SaaS customers on managed hosting? Boughton suggested a number of potential benefits:

* Time to market

A SaaS provider that wants to create its own data center environment faces a time-consuming task. Boughton said Hostway can spin up a hosting environment in a couple of weeks, so vendors can load their apps and begin testing. He said that task would take 3 to 6 months if the SaaS vendor were to build on its own.

* Ease of scaling

As a SaaS app gains market acceptance, the managed hosting provider can keep pace with demand.

“Scaling in a hosted environment is much quicker and easier,” Boughton said.

* Reallocation of resources

A SaaS vendor’s clients are going to have plenty of questions about the software, Boughton said. Placing hardware concerns in the hands of a hosting provider frees a vendor’s resources to focus on those software queries.

Software vendors “don’t have to troubleshoot and maintain hardware,” Boughton said.

Managed hosting firms should have plenty of opportunity to make their case to SaaS vendors. Gartner said it expects SaaS delivery to see “healthy growth” through 2015, when the company predicts the global SaaS market will reach $22.1 billion compared with its $14.5 billion projection for 2012.

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