Software as a Service (SaaS) is simply the idea of providing a software to a range of users whither they are students, company employees, or maybe customers. A great examples of SaaS are Microsoft Office365 and Google Docs. The SaaS concept is widely adopted nowadays due to the fact the it cuts down cost, it easier to manage and maintain, it provides a profitable way of providing a service.
Is SaaS the right model for me?
In general, if you are looking to provide a certain functionality to multiple users for business purposes or to help productivity in the organization then SaaS is on top of the list of solutions to consider.
How does SaaS increase profitability in business cases?
SaaS allows you to provide the service with the same cost for a single user to many users and as the number of users grow then your cost will grow with the same basic methodology. When software engineers plan the SaaS service they can determine the number of users that the structure can handle and all these users will full under the same cost.
There might be in some cases additional expenses that comes along with the number of users, but that cost will still be smaller in compression with building the service for each user separately.