The SaaS (Software-as-a-Service) model has transformed the way we think about delivering applications and services. Consumer and enterprise applications routinely use the web platform to create flexible interfaces powered by API-delivered backend data services, often improving the quality, security, and user experience of applications.
SaaS is a cloud modality: data storage and much of the business logic of SaaS applications resides on remote servers. As such, SaaS is often linked to other cloud services, including IaaS (Infrastructure-as-a-Service) and PaaS (Platform-as-a-Service). But, there is no necessary connection: there are advantages to SaaS application developers taking control of the infrastructure layer.
Colocation of owned hardware provides greater control over the deployment and architecture of the networks of servers that underlie all SaaS applications.
Control And Flexibility
Colocation provides the ultimate in control and flexibility. SaaS application companies that choose colocation control which hardware they deploy, where it’s deployed, and how it’s managed.
With colocation, companies are responsible for the procurement and management of servers, but for established companies with server management expertise, colocation provides the freedom to build custom platforms that are perfectly suited to their individual requirements.
Colocation users have insight into and influence over all layers of the SaaS delivery stack, from the bare metal to the client application.
Performance
The cloud has a performance problem, and it’s a problem that manifests as increased costs for cloud users who demand optimal performance from their infrastructure.
As a multi-tenant server hosting modality based on virtualization, IaaS users never benefit from the full capabilities of the physical layer. When established companies look at the performance-cost ratio of their cloud deployments, they often realize that the cloud isn’t the best option.
Tiingo, a financial research platform, migrated from the cloud to bare metal when they realized that network speeds, disk speeds, and CPU performance on a public cloud platform are inferior to lower-cost bare metal solutions.
Security
Public clouds are more secure than they once were, but the security they offer pales in comparison to owned hardware colocated in a secure world-class data center.
I don’t want to kick the cloud while it’s down, but the recent Spectre and Meltdown vulnerabilities are a perfect demonstration of the problem. Public cloud platforms are multi-tenant environments: users have no control over who shares the bare metal servers on which their data is stored. With Spectre and Meltdown, it’s possible for malicious users to run code that provides access to the supposedly secure data stored on other virtual machines hosted on the same server.
Spectre and Meltdown are bad for the entire server hosting and data center industry, but, for SaaS providers who own their own colocated hardware, the risk is significantly reduced.
SaaS in the enterprise
Many SaaS vendors lose business because they can’t convince enterprise organizations that their public cloud-hosted applications are sufficiently secure.
Any SaaS application vendor who has been asked to provide a special on-premises version of their application for an enterprise client knows what I’m talking about. The choices in that situation are stark: walk away from the deal or change the nature of your business. This issue is less likely to arise when the application is hosted on owned infrastructure in a certified data center.
The cloud is great for deploying MVPs and for early-stage startups that don’t have a clear idea what their infrastructure requirements will be, but for established SaaS businesses, colocation offers the best combination of control, performance, flexibility, and price.