How to Choose the Right Cloud - Advanced Design Approaches to Emerging Software Systems - page 226

can be an alternative metric in the cases of SaaS
products that require concurrent user intensive
functions. Examples of such SaaS products may be
teleconferencing applications, discussion forums,
calendars, or even information portals. Concurrent
user is an industry standard term that refers to the
total number of people (as measured by network
connections), that are connected to a server or
online service at any one point in time. The term
“concurrent user” is analogous to “port” or “line”
with respect to a telephone branch exchange (Nef-
sis, 2010). In general, the pricing based on number
of users or user licences may be combined with
additional fees for extra bandwidth and storage.
Transactional data refer to the interaction
between a subscribed customer and the SaaS
provider and usually are one -time fees based
on the needs of the customer. For example, SaaS
Optics (2010) define several types of transac-
tion items within the subscription life cycle. In
essence, these transaction items are the events
that can occur with regard to a term agreement
over time. Such transactions may involve New
Subscription, Upgrade, Downgrade, Adjustment,
Renewal, Cancellation . New Subscription service
is a one time fee that can break down to license
and professional services fees. License costs
are related to the initial subscription to the SaaS
service. Professional services fees may include
consultancy, training, user support and several
other customer needs that may occur. Upgrade,
Downgrade or Adjustment are three services that
can be offered to a single customer subscription
that allow the customization of the application
to the customers needs. The fees charged are
based on the level, the costs and the time required
for the incorporated changes. Renewal charges
include the fees related to the continuation of
the services to the customer while cancellation
fees include penalties to the customer in case of
cancelling the contract based on the time period
of the notification.

Workflow data may involve usage metrics
involving process oriented activities. Such metrics
are relative to the specific SaaS application and
are forced by the business goals. For example an
E-commerce system may count the number of
sales or invoices send, an Advertising& Marketing
system may count the number of emails or forms
received. The usage of a document management
system is reflected by the number of documents
download or uploaded. Workflow metrics are
defined by the procedures and user tasks incor-
porated in the SaaS software and are indicators
of the level of successful usage of a system. A
high level of workflow metrics is associated with
relevant economic benefits of the SaaS customer.
We mentioned possible data and metrics that
can be used to bill SaaS based on the type of the
application and the customer's needs. As with
any variation of products available to market
there should be differences in pricing taking into
consideration the basic marketing mix: the four P's
of product, price, promotion, and place (Lovelock,
2007). Depending on the potential customer the
SaaS services might be different, the price might
be different, the hosted place and the product might
be different. Table 1 summarises the metrics that
are currently used by SaaS providers to charge
their services. Still the pricing models of SaaS are
in their infancy at a lot of research is devoted to
capturing the correct price model that will better
reflect the usage and value of SaaS.

B. Platform as a Service

Platform as a Service (PaaS) includes the deliv-
ery of operating systems and associated desktop
services over the Internet without download or
installation. PaaS is an outgrowth of Software
as a Service targeted to middleware distribution.
Platform as a service is a development platform
hosted to the cloud and accessed via a network.
The functionality that PaaS offers involves at
least the following: operating systems, developer