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Hybrid Cloud For Dummies by Dan Kirsch, Fern Halper, Marcia Kaufman, Judith Hurwitz

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Multi-Tenancy and Its Benefits

Multi-tenancy means that the SaaS vendor provides a single version of its software for all its customers. This differs from a single-tenant hosted solution where the application is housed on a vendor’s server but the codebase is unique for each customer.

So, how does multi-tenancy work? Although all users of the software access the same foundational components, the data and configurations that are specific to a customer are stored in a separate and secure container. Users can access all the capabilities of the software, but what isn’t shared is their data. The advantages of a multi-tenancy SaaS over a third-party-hosted, single-tenancy application include these:

check.png Lower costs through economies of scale: With a single-tenancy-hosted solution, SaaS vendors must build out their data center to accommodate new customers. In contrast, in a multi-tenant environment, new users get access to the same basic software, so scaling has far fewer infrastructure implications for vendors (depending on the size of the application and the amount of infrastructure required).

check.png Shared infrastructure leads to lower costs: SaaS allows companies of all sizes to share infrastructure and data center operational costs. Users don’t need to add applications and more hardware to their ...

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