Document:                       STR-344
Date of Publication:          May 3, 2007
Number of Pages:             4
Lead Author(s):                M. West
Price:                              $295 USD

Perspective Summary:

The most effective SaaS pricing exploits metrics that successfully relate to the value the user perceives – varying relative to the nature and value proposition of the SaaS solution. While appealing to the customer’s perception of value, a value metric should also align with the SaaS provider’s business model. In this sense, SaaS pricing differs from perpetual-license software pricing in a very significant way: the cost of running the datacenter and business operations must be covered by the SaaS subscription and other related service fees.

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