SaaS Growth in Energy and Utilities
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- Jun 7, 2019 5:45 pm GMT
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The energy and utilities sectors are parts that grow whether or not infrastructure grows with them. Of course, heightened infrastructure makes the whole cycle better but expansion is going to happen even if the tools aren't ready. Technology handles the rest, allowing space for computerized infrastructure in the cloud, which can lead to infinite amounts of growth.
These days, our utilities depend on technology and the cloud to continue running. Programs that help everything move more efficiently are highly sought after and used liberally, making them expand as a result. These systems expand so much that they don't need to send out products anymore but rather send their services through the cloud for a fee, which is what many utility companies have come to prefer. This is how SaaS has grown as large as it has and continues to grow today.
What Is SaaS?
SaaS stands for Software-as-a-Service. The software included in SaaS is bought online, sent through a cloud, and used on that cloud. You never actually download or own the software, as you pay for the service to use it. SaaS and similar processes almost work like renting except there's no physical product involved even though you pay on a subscription basis.
SaaS is almost always there to perform business functions and can be accessed anywhere with any device. The general idea is convenience that helps businesses keep moving, like the utility sector. They also help keep everything up to date and as modern as possible. After all, you need a connection to the cloud to use the software in the first place, so having everything connected to the cloud is the only way to keep business flowing.
How SaaS and Utilities Come Together
Utilities are able to grow by finding more efficiency in the power they consume. That's where SaaS comes in. The only way utilities can expand is by innovating with more bandwidth, to calculate what kind of power consumption they can expect, and how to save millions just by producing exactly what they need. This way, utilities can save money so they can grow larger, which causes a ripple effect on other sectors to grow, too.
Without third-party platforms like SaaS, managing energy data can be a massive struggle. The numbers are always changing, supply and demand fluctuating during different parts of the year or even the week, and people changing their habits as well. In all, the management of energy resources is a hassle without SaaS, data, and artificial intelligence to do most of the work for you. Once the process is streamlined and constantly fluctuating, then focus can shift to expansion. As utilities grow, SaaS will need to grow just to keep up, creating the cycle.
SaaS and Taxes
While the idea may be shocking to some, despite not really owning the product, SaaS is taxable. By having use of the software and doing what they want with it, users are basically given constructive possession, which means they have a right to use, control, or direct how the program operates. This leads to the service getting taxed. As online markets keep growing, though, taxes keep finding their way in, so it's not shocking to see how everything keeps evolving to stay afloat.
Of course, this is a controversial ruling. Since the service isn't owned and is entirely hosted online, it does seem weird that taxes are involved at all. That's why they hadn't been involved for a long time. Taxes in online market places is a concept that's recently grown in popularity, especially as big businesses are sprouting up entirely online. The more these businesses grow, the more others will want to tax them.
How SaaS Grows
Innovation aside, SaaS grows because the money is there to help it move forward. People prefer SaaS to owning the software because of the much lower cost on something they plan to use for a limited time. Money can also be saved by cutting out less efficient models to use the SaaS instead, which only leads to more growth.
Convenience is also a major selling point. Having the software directly on a cloud server and connected to any device you need provides modern help right at your fingertips no matter where you are. With the modern workforce being out in the field or even working from home, this aspect is a huge contribution as to why companies love SaaS and keep using it, making the industry grow more and more.
SaaS is already commonplace in the energy and utility sectors, allowing us to produce more than we ever have before. As of right now, the software SaaS offers are some of the most efficient ways to work so far. Someday, though, SaaS will become an outdated model for software. What comes next could be anything from everyone owning part of the software to free web hosting or maybe something completely different. We don't know what the next big thing will be yet, but we do know that SaaS isn't leaving anytime soon.