The Power in the Cloud

"Haenisch noted that SAP has tried to circumvent the performance issue by using something he called "isolated tenancy." Multi-tenancy brings down hardware costs, but impacts performance. On the other hand, maintaining a single server for each customer would be prohibitively expensive. Haenisch said that isolated tenancy provides the performance benefits of single tenancy with the cost advantages of multi-tenancy. "Each customer has a dedicated instance of the software and database," he said. A similar software delivery mechanism, ASP, had its heyday and then crashed earlier in the decade. But ASP 2.0, as SaaS is sometimes called, has avoided the pitfalls of its maligned predecessor. Most importantly, SaaS is not an attempt to deliver on-premise code via the Internet. SaaS solutions are designed specifically for online delivery."