There are some major changes taking place in the world of software as a service. Also called SaaS, this segment of the business universe has undergone massive transformations in the past decade. In order to understand how the recent growth of blockchain technology has affected it, it’s best to begin with a couple of definitions.
What is Software as a Service?
This unique model came into the mainstream about a decade ago. It allows for licensing as well as delivery. Buyers are essentially subscribing for a time-defined use of a specific application for a fee. The central host earns its money by selling subscriptions. You’ll hear it referred to as on-demand, or perhaps by its original name, software plus services. If you pay a company a monthly or annual fee, for example, to use its stock market analysis software, you are purchasing this type of service.
What is Blockchain Technology?
Behind all the major cryptocurrencies like Bitcoin, Ethereum, Litecoin, and others is a system of cryptography called blockchain. In its simplest form, this chain consists of an ever-growing mass of records. Each block of data is specially encrypted using advanced forms of cryptography. All the blocks that make up the entire chain are connected to each other. As each new set of records is added to the chain, it includes a hash that connects to the last record in the batch, all its own unique data, as well as a specific time stamp of when it was added to the chain. Because of the careful, secure design features, it is nearly impossible to alter the data in the blocks in any way.
Key Facts about Blockchain and SaaS
Many changes are already taking place in the business-to-business market. One of the biggest is the way in which new alternative coins are being sold. With that in mind, here are some of the most impactful ways in which cryptocurrency, and the block system that underlies it, is affecting the software as a service marketplace: New coin offerings, called ICOs, are now aimed not at retail-level consumers but at developers, particularly at experts who create and sell SaaS products to consumers.
Why is this such an important development? It’s leading those creators and sellers of advanced apps to integrate new cryptocurrency functionality right into their products.
There are now many mainstream uses for cryptocurrency such as trading, purchasing consumer goods, and paying for everyday services like haircuts, massages, and medical treatment. But consumers are also paying for advanced apps with cryptocurrency, which means that at least one part of the financial world widely accepts payment in non-traditional forms of money.
People who develop advanced technology, called developers, are most likely to use blockchain tech when they create new products. When consumers wish to buy a subscription of a new form of proprietary application, for example, they’ll be able to use alternative currencies to pay. Block technology is spreading rapidly and will likely be embedded in new SaaS offerings in the near future. That means businesses who purchase an enterprise application, for instance, will be able to leverage the security and privacy aspects of encrypted blockchains in all their transactions.