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A subscription instead of a licence
With SaaS, software as a service, you pay every month for software someone else runs and updates for you. Nothing is installed on a server of yours, you never own a licence outright, and updates arrive on their own. Your accounting package, Microsoft 365, a CRM you log in to: if you sign in on a website and pay per user per month, you are using SaaS.
The word that matters is service. You do not buy a thing, you buy something that keeps running as long as you pay. The provider looks after servers, security, backups and new versions. You manage your own data and a handful of settings.
From shared computers to the browser
Until the late 1990s, companies bought software on a disc or had a package installed on their own server, with a licence and a maintenance contract. In 1999 Salesforce opened with the idea of "no software": a CRM you simply used in a browser. Others followed, and the per-user subscription became the norm.
The definition that still turns up in contracts and public tenders comes from NIST, the US standards institute. In September 2011 Peter Mell and Tim Grance published SP 800-145, The NIST Definition of Cloud Computing, with three service models. With SaaS you use the provider's applications on its cloud and manage nothing underneath, apart from limited user settings. With PaaS you deploy your own application on the provider's platform. With IaaS you rent computing power, storage and network, and run everything on it yourself, down to the operating system.
Who manages which layer: SaaS, PaaS and IaaS
Who manages what, per model
You manageProvider manages
In-house
own server, own licence
- Data and settings
- The application
- Runtime and tools
- Operating system
- Servers and storage
- Network
IaaS
you rent computing power
- Data and settings
- The application
- Runtime and tools
- Operating system
- Servers and storage
- Network
PaaS
you rent a platform to build on
- Data and settings
- The application
- Runtime and tools
- Operating system
- Servers and storage
- Network
SaaS
you rent the software itself
- Data and settings
With SaaS you keep only your own data and settings in hand.
The further along the row, the less you maintain and the less you can change. SaaS is paid per user per month, for as long as you use it.
Fifteen users, five years: the bill
A subscription looks cheap per month. Always work it out over the years you will use it, and for everyone who logs in. Odoo is a fair example because its prices are public: Standard costs 19.90 euro per user per month billed yearly, and Custom, with Studio and the external API, 35.90 euro. Those prices hold for the first 12 months; after that you pay 24.90 and 44.90 euro.
Take a 15-person installation company. On Odoo Standard it pays 3,582 euro in year one and 4,482 euro every year after: 21,510 euro over five years, before any partner sets it up and before extra apps. If it needs Custom for its own fields and integrations, the five-year bill is 38,790 euro.
| Users | Odoo Standard, 3 and 5 years | Odoo Custom, 3 and 5 years |
|---|---|---|
| 5 | 4,182 / 7,170 euro | 7,542 / 12,930 euro |
| 15 | 12,546 / 21,510 euro | 22,626 / 38,790 euro |
| 40 | 33,456 / 57,360 euro | 60,336 / 103,440 euro |
Billed yearly, with the first-year discount and the regular price after. Partner fees and add-ons come on top; see Odoo pricing. For other packages per user, see Teamleader alternatives and Odoo alternatives.
Buying across EU borders changes the invoice, not the price. A SaaS provider in another member state bills your company without VAT and you reverse-charge it in your own return. The same holds when a Belgian agency builds software for a company in the Netherlands or Germany.
Renting against building, point by point
- Start
- SaaSTomorrow, with a trial account
- Custom buildAfter a build of weeks or months
- Cost
- SaaSPer user per month, for as long as you use it
- Custom buildMostly at build time, then hosting and upkeep
- One more user
- SaaSOne more licence
- Custom buildUsually nothing extra
- Fit with your work
- SaaSYou adapt your work to the package
- Custom buildThe software follows your work
- Updates
- SaaSArrive on their own, wanted or not
- Custom buildWhen you decide
- Your data
- SaaSWith the provider, with an export
- Custom buildOn a server you know
Pick SaaS for work that runs the same in every company. Pick a build when your process sets you apart, or when the number of users drives the bill up.
When a build becomes cheaper
A custom build is paid mostly up front. Another user costs next to nothing, and you do not pay for the hundred features you never open. So the question is not what a build costs, but whether the build plus five years of hosting and upkeep stays under the figure in the table. For five people doing standard invoicing, almost never. For forty people with a process no package was made for, the sum can flip. The full reasoning is in build vs buy software; to scope a build before asking for prices, use our software requirements template.
Two things weigh in that no price table shows. First, your data. The EU Data Act applies since 12 September 2025, and from 12 January 2027 a cloud provider may no longer charge for switching; SaaS must let you export your data in a common, machine-readable format. What that means for contracts is in our news on Data Act cloud switching. Second, who handles your customers' data: if personal data goes into a SaaS, ask for the data processing agreement and where the servers stand.
There is a middle road: SaaS for what is standard, your own layer on top. A webhook lets your package tell your own software the moment something happens, and Peppol carries invoices from a custom tool into any accounting package. Starting something that could become a product for others? Start with an MVP.
About subscriptions, data and cancelling
What is the difference between SaaS and cloud?
Cloud is the wider idea: computing power, storage and software rented over the internet. SaaS is one of its three service models, next to PaaS and IaaS. With SaaS you rent the software itself; with the other two you rent the parts to build or run something of your own.
What is a SaaS product, in plain terms?
An application you log in to on the web, built once by a provider and used by many customers, each seeing only their own data. Slack, Microsoft 365 and most accounting packages are SaaS products. The provider earns from subscriptions, so it keeps improving the product for all customers at once.
What happens to my data if I leave a SaaS?
You should be able to take it with you. Under the Data Act a provider must allow export in a machine-readable format, and from 12 January 2027 it may no longer charge for switching. Test the export before you sign, not on the day you want to leave.
Is SaaS always cheaper than building?
At the start, nearly always. Over five years it depends on users and fit. Fifteen users on Odoo Custom cost 38,790 euro in licences alone; a build that fits your process and costs little per extra user can come in lower, and it is yours.