The Difference Between ASP and SaaS
ASP refers to the term "application service provider", or a business that provides access to and service for computer applications over a network. "Saas" stands for "software as a service" and defines the business model that application service providers use to provide software services to clients.
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Business Model
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Application service providers (ASP's) own, operate and support the software, servers, and network infrastructure used to deliver software applications to end users. Software as a Service (SaaS) is the delivery model that end users use to purchase access to software and support for a periodic fee.
Pricing Model
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ASP's absorb the costs for purchasing, licensing, and supporting the software and network infrastructure and bill clients periodically with subscription fees. The SaaS delivery model negates the capital expenditures associated with hardware, software, licensing and support by end users in exchange for a recurring payment by clients.
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Benefits
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ASP's achieve economy of scale by absorbing application procurement and support costs for software systems that are recovered by subscription fees from multiple clients. Saas delivers efficiencies to end user clients by negating the requirement to purchase hardware, software, and support personnel, and allowing them to focus upon their business procedures faster without the overhead associated with a technology investment.
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