Element

Traditional Technologies

Modern Technologies (SaaS)

Deployment

Require substantial amounts of time spent trying to install or configure hardware/software before a business can start to get familiar with its new system.

Compatibility problems and problems coexisting with other software will usually arise.

No installation involved. On-demand systems are immediately ready for use via the internet.

Installing a web application means typing a URL in the address bar then entering a username and password. Access can be acquired whether users are in the office, at home or abroad.
 

Capital Expense vs. Operating Expense

Require substantial, up-front investments. The advantage is the business will usually own the licensed software and any hardware acquired. Although there is a high risk of hardware or technology becoming obsolete as operational environments change.
 

Lower, monthly operational expenditures. No capital purchase budgeting. No computer infrastructure to be purchased or maintained. Business never owns the software, only the data.

Ongoing Costs

Businesses must purchase computer hardware and maintain it. Software must also be purchased ususally through a 'per user', 'per concurrent user’ or 'per server' license agreement, apply upgrades, and maintain the system. IT staffing is needed to perform these tasks.
 

On-demand pricing models make predicting costs easy. Low monthly payments align with a businesses operating expense budget and is usually inclusive of all maintenance, updates, data hosting, customer support and online training.

Level of Maintenance

Constant system configuration and trouble shooting for application components and/or web services is required.

On-demand systems are managed by their providers so that businesses do not have to be concerned with maintaining or applying upgrades, patches, or other features to their systems.
 

Time to Value

Initial start up costs, ongoing maintenance, upgrade, support and staffing costs can become substantial requiring a longer time to realise returns on investment.
 

On-demand systems do not require deployment of hardware or software for their use. They generally realise a faster return on investment.

Risk Factor

Traditional softwares are generally high risk because of the financial investment required to set up and maintain them. There is also a risk of users running different versions, technology going obsolete or corrupted data and interruptions to workflow or business operations as a result of viruses.

Provide lower risk as they are generally pay as you go solutions. Highest risk is as small as your scheduled monthly payment. No contracts. No capital investment. If the business climate changes drastically, businesses can choose to drop the solution, change to a new provider that meets their new needs, or head in entirely different direction without any significant financial implications. However business interruptions exist if internet service is not available.