Computers have revolutionized every aspect of life including commerce. Yet the machines themselves and the programs they run are labor-intensive and costly, which can adversely affect a company's bottom line. The innovation of server hosting has come to the rescue.
Most companies think of this option in terms of their websites. It's true that such services started out as major on-ramps to the Internet superhighway. Over the past decade leasing online service came in three versions: shared hosting, virtual private server or dedicated server, all of which function Internet gateways.
However, today more companies are finding that internal as well as external business functions can be filled via hosted networks. As a result, a fourth category has emerged, that of Software as a Service, or SaaS.
Shared arrangements for online websites and limited e-commerce work well initially for small and start-up companies, along with churches, community organizations and other non-profit groups. The cost for leasing such a service is low and the provider bears the overhead costs of hardware and software management and maintenance. However, it isn't long before a business outgrows a shared contract.
Virtual Private Servers, or VPS, offer a stronger option for some small and medium-sized companies. By leasing a specified portion of a computer, companies gain access to greater amounts of computer resources.
The next step up from VPS is a dedicated server, also called managed hosting. Here a business can lease an entire computer for itself. The company can opt to manage the computer itself via the Internet, or it can contract with a service provider to assume that responsibility. With a dedicated server contract, a business gains the right to specify what kind of computer and software it uses, along with what type of operating system the leased server employs.
The advantages to both VPS and dedicated server include less overhead, since the lessee doesn't own the equipment. Use of VPS and dedicated servers also gives companies a larger return on their investment since they aren't burdened with capital investment and depreciation. Business performance also improves, since computers leased in this way typically are housed in data centers outfitted with redundant climate control and power sources to assure continued operation.
Software as a Service, or SaaS, is the latest development in online computing. Also called "on-demand software", SaaS relieves a company of nearly all the operational burdens of administering its own system. With this option, the business' data and software are hosted on a distant computer, often the same machine that the company leases for online commerce. Employees then use a computer or software known as a "thin client" to access business functions such as accounting, order fulfillment, supply management, customer service and other work.
These options in server hosting make it economical, efficient and effective for any business to stay current and competitive.