Economics of Multitenancy-Based Software as a Service

Monitis upfront design all its applications as multi-tenant hosted services. Multi-tenancy is a principle in program design where a single case of the program functions on a software-as-a-service (SaaS) provider’s servers, delivering its services to manifold user groups (tenants). It is different from a multi-instance design where different program instances or hardware system are installed for different user groups. With the help of a multitenant design, a software application is structured to practically separate its data and arrangement. Thus, each user group works with a tailored virtual application case.

Economics of Multi-tenancy software architecture:

1) Cost Savings. Multi-tenancy allows for cost savings over and above the basic economies of scale achievable from consolidating IT resources into a single operation.

2) Data Aggregation/Data Mining. One of the most compelling reasons for vendors/ISVs to utilize multi-tenancy is for the inherent data aggregation benefits.

3) Complexity. Because of the additional customization complexity and the need to maintain per-tenant metadata, multitenant applications require a larger development effort.

4) Community. This inter-tenant collaboration is very powerful.

5) Release Management. Multi-tenancy simplifies the release management process. In a traditional release management process, packages containing code and database changes are distributed to client desktop and/or server machines. These packages then have to be installed on each individual machine. With the multi-tenant model, the package typically only needs to be installed on a single server. This greatly simplifies the release management process. Need facts? Check how many features we were able to release during the last months!

Important note: when a vendor claims that it provides SaaS check if it is really multi-tenant!