What is XaaS (Anything As A Service)?
XaaS, an acronym for ‘anything as a service’, is a wide-ranging term. It refers to providing an application tool, service, or game delivered through the cloud to your laptop or another device.
In other words, XaaS uses cloud computing to provide various services to customers instead of utilizing on-site local software.
The XaaS industry continues to transform businesses as it is projected to grow from $419.02 billion in 2021 to $2,384.12 billion in 2028.
But how does XaaS work as a business model? Why is it important? What is the role of XaaS in digital transformation? We will aim to answer these questions and many more.
Why is XaaS important?
Before the cloud went through concurrent processes of digitization, digitalization and digital transformation meant investing in on-site computer programs and relevant hardware.
As a result, companies needed more office space to store this software, which required continuous maintenance.
But, since the beginning of XaaS, companies can utilize cloud-based infrastructure for their technology needs.
This means that businesses no longer have to invest in costly infrastructure or recruit many full-time employees to maintain on-site software.
In addition, businesses can also scale at a quicker rate as a XaaS service could be paid on a subscription basis, meaning that a company can adjust, cancel or adjust their type of service as and when they want.
What is XaaS technology?
XaaS technology refers to any form of cloud computing technology that allows users to store and access data over internet-based devices such as tablets, wearables, computers and smartphones.
What is the difference between XaaS and SaaS?
Since several ‘as a service’ models are available, XaaS is an umbrella term that encompasses all services in a cloud that customers can access through the internet.
SaaS is one type of XaaS and stands for ‘software as a service’.
An example of SaaS is office 365 from Microsoft software from a browser on different devices through a subscription.
You need to buy and install programmes for your local PC. A SaaS solution is ideal for a company that wants smooth and reliable running without much input required.
If something goes wrong, it would be up to your SaaS provider to find a solution.
What is IaaS vs PaaS?
IaaS, which stands for ‘Infrastructure as a service’, offers services like networking, virtualization and pay-as-you-go storage. In other words, IaaS allows companies to invest in cloud-based alternatives to on-site infrastructure, meaning your business can avoid expensive on-premise resources.
An example of an IaaS company is Microsoft Azure.
Alternatively, PaaS stands for ‘Platform as a service’ offers software and hardware tools to develop applications over the internet.
Typically, PaaS users tend to be developers. This type of service means that developers do not need to create applications from scratch, saving them money. An example of a PaaS organization is AWS elastic Beanstalk.
PaaS can be built on an IaaS platform, while SaaS can be built on top of a PaaS or IaaS platform.
How does IaaS work?
IaaS involves utilizing a cloud provider’s virtual or physical infrastructure reserve from its data centers.
This solution works by giving users access to servers, storage, networking and virtualization. It could also include the management of this infrastructure, billing management, backup storage, and network connections.
Once users have access to these resources, they can install the relevant operating systems, employ specific databases, create storage, and install particular workloads.
In addition, companies can pay for IaaS services on a pay-as-you-go hourly, weekly or monthly arrangement and can sign-up for as many resources as needed.
What are some more examples of XaaS?
As well as SaaS, IaaS and PaaS, XaaS also includes these other services:-
- DaaS is an acronym for ‘Desktop as a service’ which gives users remote access to the relevant files, programmes and software they need for work, even when they are out of the office. An example of a DaaS business is Citrix.
- CaaS stands for ‘Container as a service’. These containers have software codes that can be run or read anywhere. A CaaS company partnership could be helpful if you did not want to build a container to store a code library. An example of a CaaS provider is the Google Container Engine (GKE).
- FaaS is short for ‘Functions as a service’. This type of service allows businesses to use specific functions or outcomes through a FaaS company without developing or running an application themselves. An example of this type of company is Google could functions.
- AaaS refers to ‘Analytics as a service’. Companies can use an AaaS provider to turn their data into insights so that these can be used to drive significant business decisions. An example of an AaaS provider is Looker.
What does XaaS mean as a business model?
Adopting a XaaS business Model can help your company move from a ‘product-based approach to more service or outcome-based.
This move means that your business can deliver more value to customers and improve revenue.
This model uses servitization which is a process that combines products and services into one package.
This package type could give customers more value than buying these products and services separately.
What are the main types of XaaS?
Apart from SaaS, PaaS and IaaS, the other main types of XaaS are:
- Storage as a service (STaaS) which uses a company’s cloud storage infrastructure to store its data. An example of a STaaS company is oracle cloud.
- DBaaS, which is database as a service for short, where a company can get access to a database in a cloud without needing to set up physical hardware, install software or configure a database.
- Disaster recovery as a service (DRaaS) is a cloud computing model that allows companies to back up their data IT infrastructure in a cloud environment. This will enable them to gain access to their infrastructure after a disaster.
- Network as a service (NaaS) which involves businesses using networking services from a cloud provider without needing to set up their network infrastructure.
What are the benefits of XaaS?
When your business adopts a XaaS model, it can offer these main benefits:
- Reduction of costs – A XaaS provider allows companies to purchase services on a subscription basis. This means that a business can cancel or adjust the services they pay for when they need it.
- Permits the allocation of IT resources to more valuable projects – As a XaaS company can also offer technical support on an issue related to infrastructure, databases or networks, your business can rely on them for its IT support needs. As a result of not needing to hire an IT support department, your business can spend this money on purchasing innovative technology that can improve employee and customer experience.
- Improves your agility – You can also expect a XaaS provider to provide new technological solutions in line with evolving market conditions or customer needs. This means that your business can move quickly in a competitive industry without needing to buy expensive on-site infrastructure and equipment to put a new solution in place.
What are the disadvantages of XaaS?
Unfortunately, every solution has its disadvantages. So you must be aware of the main pitfalls before choosing a XaaS solution:
- More significant likelihood of security issues – You need to research XaaS providers thoroughly before relying on their services. This is because when you partner with a XaaS provider, you are giving them access to your sensitive data and entrusting them with your reputation. Start by searching on Google to check for anything adverse on this organization and check their existing security badges and verifications on their website.
- Outages and performance issues will not be in your control – There will be occasions where the XaaS provider you are relying on will have performance and outage issues. These issues can disrupt your business and customer service as you rely on these services. To prepare your business for these instances, continuously monitor a XaaS provider’s average uptime and downtime to assess the value of the service you are receiving. It is also essential to have a backup emergency XaaS provider to absorb any impact of a disaster or outage.
- Beware of hidden fees and licenses – It is easy to amass a more prominent number of fees and seats or new employees when your business grows rapidly. So, before signing a contract with a XaaS provider, look at its current and future subscription costs.
What is the role of XaaS in digital transformation?
Using a XaaS provider can accelerate the rate of digital transformation at your company by using technology as a service to increase value for a customer, which in turn helps the business. A XaaS solution can boost your digital transformation efforts by:
- Giving businesses the flexibility to pick and choose services for their technology environment.
- Enabling innovation and agility as companies can access new technologies and infrastructure as and when they require, without the higher costs.
Making it easier to acquire data-driven decision-making tools that can turn big data into insights to improve business outcomes and customer and employee experience.
What is everything-as-a-service (XaaS) in cloud computing?
Everything-As-A-Service is a cloud computing expression that refers to several services and applications purchased through subscription over the internet, rather than needing to be bought physically.
Can XaaS Be Combined With New Cloud Services?
XaaS providers allowed businesses to use cloud technologies to make specific processes more manageable to achieve, even during the uncertain times of Covid-19. As a result, XaaS will continue to expand and be combined with new cloud services to help organizations achieve a better outcomes-based approach. These new cloud services could include:
- The birth of carbon thoughtful cloud providers who prioritize reducing energy wastage when migrating your organizational processes to the cloud. This sustainable type of initiative will become more popular in the future as it can reduce carbon dioxide emissions by up to 59 million tons yearly.
- Hybrid cloud providers will also allow businesses the best of both worlds. For instance, a public cloud allows a company to provide its customer with quicker and more frequent access to the data they need. On the other hand, a private cloud can host more sensitive data that only certain leaders at an organization need to see.
Offering artificial intelligence (AI) through cloud services meaning that all types of companies can access this type of technology without the upfront investment. In addition, this new cloud service means that you can benefit from insights gained from big data that can be used to further your goals.
Why would a company want to utilize XaaS services?
Any type of company, especially smaller companies, could benefit from XaaS services as it can help:
With the adoption of new technological solutions to quickly meet market conditions and customer needs.
- Make more informed business decisions due to the wide array of big data and analytics cloud computing tools.
- Reduce time spent on managing infrastructure and networks to improve the employee and customer experience.
- Lower costs spent on on-site technology as companies only pay for tools and features they need.
Examples of companies using XaaS
As the XaaS model continues to make the cloud an essential part of improving business, customer and employee outcomes, there are some examples of companies you can take note of for your organizational growth. These businesses are:
- Neo Financial – This Canadian financial services startup used Amazon Web Services (AWS) solutions to create an agile architecture for their business within the cloud. This type of service from a XaaS provider allowed them to quickly test innovative features and functions without investing much money in technology. In addition, this solution enabled them to dedicate more time towards customer centricity.
For instance, it uses AWS Code Build to source code, run tests, and build software packages ready to deploy without managing or scaling their servers. Furthermore, it also used the Amazon Elastic Container Service (Amazon ECS), making it easy to deploy, manage, and scale applications within a container.
- Patagonia – To improve its customer experience, Patagonia used Microsoft Dynamics 365 to develop a better connection between its internal teams. Before implementing a Microsoft XaaS solution, retail in-store associates at Patagonia could not find the original receipts for online purchases a customer made. As a result, customers faced problems when they came to collect a product in-store.
If this disconnected experience continued to occur, it would cause the loss of customer loyalty and business revenue. So Microsoft Dynamics 365 acted as a central solution for this company in enterprise resource planning (ERP), order management and retail. In this way, its customers can now experience a seamless omnichannel experience while Patagonia can also benefit from reduced costs and more efficiency.