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Compare the implementation of systems using a client’s hardware with hosting systems remotely.


Teaching Note:

The benefits and drawbacks of SaaS (Software-as-a-Service) should be considered.

S/E, INT, AIM 8 The remote host may be in a different time zone and this can have significant effects on end-users.



Sample Question:



JSR Notes:

A main focus of this assessment statement is SaaS, Software as a Service. But more generally it is all about support of local IT system via external help. There are several examples of this.

Introductory Definitions and Comparisons

Outsourcing - General term for all services done by a company external to a particular organization.

Hosting Systems Remotely - Hosting one or more full IT systems via outsourcing.

Cloud Storage - Storing of data only remotely.

Software as a Service (SaaS) - Running application software from powerful remote servers.

Though these are all slightly different, you will note below that the benefits and drawbacks of them all are roughly the same.


Outsourcing is taking parts of an IT system and letting someone else deal with it, in some other company, fairly likely in another country.

Outsourcing is actually a more widely applicable term meaning "obtaining (any) goods or a service from an outside or foreign supplier, especially in place of an internal source". As a practice that has existed for years and years, it is now commonly employed by IT firms in particular, due to the specialization and cost savings that can be offered by this practice. Often the cost savings are achieved by outsourcing to a foreign country where the cost including hourly wages of IT laborers is low. With IT, this can be any number of services that are outsourced, from help desk services to SaaS to cloud storage. The following three terms are all examples of IT outsourcing.

A. Hosting an entire System Remotely

As one example of outsourcing, hosting systems remotely is the hosting an entire IT system with a company outside of your own. So a company will access payroll services, for example, via the remote system, but all of the processing happens on the remote servers and is managed by the remote hosting company.

Examples include:

Benefits of Hosting Systems Remotely

Drawbacks of Hosting Systems Remotely

Note that some systems should never be outsourced for security and privacy issues. Security systems should not be hosted remotely if at all possible, and to take a specific privacy example, the patient database services of a hospital should be handled in-house if technically possible. And, generally, it makes no sense to employ remote hosting if the IT system can be run and run with less expense in-house.

B. Cloud Storage

Saving data of an individual or a company on remote servers, either as the main storage location or as backup. Examples include the Apple "Cloud" and DropBox. The point is that not only can a person back up their files with DropBox, a whole company can pay for another company to look after a lot of their data storage and processing.

Benefits of Cloud Storage

Drawbacks of Cloud Storage


C. Software as a Service (SaaS)

SaaS, or Software as a Service, is a way of delivering applications over the Internet—as a service. So with SaaS, a company (or any person or organization for that matter) makes use of remote computers to do their processing. The software used is actually being executed on the remote server. You as the user merely use what is referred to as a "thin client"; you only see the results of the processing (output) on your screen, and do the input at your thin client station (your Internet connected computer).

"What is old is new again." SaaS is similar to the way that old mainframes worked in the 1970s and 80s, with the idea of labs of "dumb terminals" connected to powerful mainframe computers. With the new SaaS approach, software which is mainly located on powerful remote servers, is accessed via over the Internet by "thin client" computers.

Microsoft Azure & Amazon Cloud (both server space and databases too) are examples of SaaS. Usually the software is licensed on a subscription basis, paid for monthly.

An example of SaaS that a few of you have used is when you have used the machine learning servers of MIT or Google etc. to test your AI experiements for your EEs. You sent the input, the crunching away was done as a service provided by them for you, and the output was sent back to you.


Benefits of SaaS

Benefits of SaaS


Drawbacks of SaaS



WikiBooks.org *


Jaime: NVIDIA Now: playing games via streaming off of powerful GPUs remote.

Data hosting vs. data processing remotely (old school mainframe idea)