Accounting Services Tools: Software as a Service versus Cloud Computing

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cloud computingIf someone hasn’t approached you trying to sell you Software as a Service, get ready.

Software as a Service or SaaS (pronounced “sass”) is a new way to purchase software or other IT services without requiring new hardware. Also, SaaS doesn’t require you to do any installation or updating yourself. Instead, software is installed and maintained on computers at a separate location by your provider and delivered to you via a web browser using your Internet connection.

SaaS is a form of cloud computing, but cloud computing can also refer to any situation where you are using the Internet to access a computer that exists in a location separate from your own. For example, if you store data in a data center hundreds of miles away, this is cloud computing.

Most people encounter cloud computing as SaaS because these programs normally include the IT expertise and maintenance services that many business owners rely on to keep their programs updated and optimized. SaaS usually enables users to access data from any mobile device, as well—a huge boon to professionals who do much of their work away from their desk, or who would like to but never had the opportunity before. Data backups are also provided automatically, and SaaS providers have various security policies in place to protect your information.

You might pay a fee for Software as a Service through companies like QuickBooks Online and Salesforce.com. Gmail and Facebook are also good examples of SaaS, but these are supported through advertising and information gathering.

The key difference between SaaS and pure cloud computing is that cloud computing allows you the flexibility to customize and build out the environment to suit your needs. However, this also requires a much greater technical knowledge and investment. SaaS limits you to the specific features and capabilities offered by your software provider.

Think of it sort of like renting an apartment: do you want a furnished or unfurnished space? The unfurnished space gives you all of the freedom in the world, but if you don’t know what you want or how to get it, that can actually end up being a burden. The furnished space is completely ready for you to start living your life, but you may encounter items in your space that you wouldn’t necessarily have selected if given the choice. It’s a trade-off that really depends on your needs versus your capabilities.

But there are still risks to cloud computing that must be considered and weighed. Here are some topics that you may want to discuss before moving forward with a cloud computing choice:

  • How secure is your data and what policies are in place to prevent loss of access? You not only want to ensure that backup servers are in place and that your data isn’t comingled with information from other companies, but you also want to ensure that your provider has a tight legal team, so there is no chance of your data being frozen. In one instance, the government seized an entire bank of data on suspicion of copyright infringement and piracy.
  • Does the company have a history of being trustworthy? Do they have reliable service? What do their current customers say about their service?
  • If you stop paying for the service, is there are grace period during which you can move your data to another storage location?

If you’d like to speak with a Beaton Accounting representative for professional advice on various accounting services available through the cloud, call us today for a FREE consultation: 631-921-6894.

Have a question or certain topic you’d like to see addressed in our next blog post? Just leave a comment, or email us at info@beatonaccounting.com