Why SaaS Companies Are Adopting Distributed Cloud Computing

Software-as-a-service (SaaS) providers have a challenge: How to attract brand-new subscribers to their applications while retaining and growing their existing customer bases? To successfully meet that goal, SaaS vendors must deliver engaging digital experiences cost-effectively. 

Increasingly, their developer teams are turning to distributed cloud computing as an affordable, scalable, and secure approach to help support innovation, accelerate time to market, and provide consistently great application performance to SaaS customers around the world.

The top 3 benefits of distributed cloud computing for SaaS developers

According to the recent study Developer Perceptions of Distributed Cloud, the three benefits that SaaS developers find most appealing about using a distributed cloud solution are:

• Improved user experience due to reduced latency (40% of SaaS developers)

• Cost-effectiveness due to localized resources (37% of SaaS developers)

• Greater capacity for handling data-intensive applications (35% of SaaS developers)

The study, from developer-focused research firm SlashData and commissioned by Akamai, surveyed more than 700 global cloud professionals. One-third of the respondents described their companies as “software products and services, SaaS” businesses. SaaS companies provide their applications to customers via subscriptions, and host those applications on a third-party vendor’s cloud platform. Today, you can find SaaS applications in every industry and they are available across all regions of the world.

The SlashData survey defined distributed cloud computing as the practice of decentralizing cloud resources and services to be physically closer to the data source or user while still being centrally managed. When comparing SaaS developers with the entire surveyed developer population, improved user experience due to reduced latency was also the number one most appealing benefit of using a distributed cloud solution (cited by 40% of SaaS developers and 38% of total developers).

The drive for exceptional SaaS application performance

With their strong focus on providing optimal experiences, SaaS vendors need cloud infrastructure that is architected to deliver subsecond application responses to their customers, regardless of their location. A distributed cloud computing approach allows SaaS developers to build and deploy applications closer to end users, keeping latency low, while enabling stellar performance.

Customers tend to have high expectations for SaaS applications, particularly regarding near real-time access and response to those applications. They might also anticipate more self-service and personalization from SaaS applications while their data is kept secure and private, which again strains the underlying cloud infrastructure. 

Customers likely access the same SaaS application from various devices — and they count on a consistent experience, with the focus on ease of use and synchronized collaboration. SaaS providers are eager to meet all these needs to establish and build long and lasting customer relationships.

For many SaaS companies, product-led growth is becoming their primary route to market — that is, their applications basically must sell themselves to potential customers — which places more importance than ever before on delivering consistently great application performance.

Flexibility and scalability: The guiding principles for SaaS companies

SaaS providers are always experimenting with new applications and bundles. They want to be able to test out new features, and then quickly make the popular offerings available by spinning up new cloud instances. As SaaS companies grow, they’re also looking to appeal to customers in new global markets, which again necessitates rapid application deployment. 

At the same time, like their peers in other industry sectors, SaaS developers are being tasked by their own organizations and their customers to operate more sustainably. With a distributed cloud computing model, SaaS developers can build, deploy, and secure their applications closer to users, regardless of their location, with the potential to optimize their use of compute resources.

Among SaaS developers, 51% see flexibility and scalability as the number one feature and attribute they expect from a distributed cloud solution. Next up was high reliability and uptime (46%), followed by robust security features (41%) in the third position.

SaaS companies and their developers aim to be as responsive as possible to their customers' changing needs. One current trend is for SaaS providers to focus on providing more industry-focused applications, which also speaks to the need to adapt to shifts in customer behaviors and market patterns.

How SaaS developers think about distributed cloud use cases and pricing

Customers of SaaS providers are also looking for applications that can handle and use large amounts of data or data-intensive applications, whether in terms of adding analytics or elements of artificial intelligence (AI). Among the SaaS developers surveyed by SlashData, the top three best use cases for distributed cloud were:

• Big data and analytics (44% of SaaS developers)

• AI and machine learning workloads (42% of SaaS developers)

• Disaster recovery and business continuity (41% of SaaS developers)

Many SaaS providers operate in highly competitive markets in which innovation and pricing can be key differentiators. To offer great price points to their customers, SaaS companies first need to understand — and then control — what they’re spending on resources like cloud compute, storage, and memory. 

With more transparent and predictable cloud computing pricing, SaaS vendors can better manage and optimize their operating costs while still providing millisecond application responses to customers.

Learn more

• Read the full report: Developer Perceptions of Distributed Cloud

• Explore the recent white paper, Distributed Cloud: Technology’s Next Act, which surveyed 425 global IT leaders and revealed that distributed cloud is becoming mission-critical for their IT strategies

• Discover how large services provider Zolvit has cut its cloud costs by 50%, while providing subsecond application response times to its customers

Find out how location data intelligence provider Smarty has increased bandwidth and lowered latency, while reducing compute resources by more than 90% and realizing approximately 60% in cost savings