In this post, Krissi Danielsson asks whether virtual software appliances compete with SaaS.

"The virtual appliance idea targets many of the same customers as SaaS, and the article points out that some companies may prefer the virtual appliance route since it would keep data in-house. Big vendors are starting to sell software to run in a VMware environment and VMware is boasting more than 2,500 virtual appliance downloads per day. But will these appliances rival SaaS? Time will tell."

So, what the heck is a virtual appliance anyway? For that answer, I found the best description on Wikipedia:"Virtual appliances are a subset of the broader class of software appliances. Like software appliances, virtual appliances are aimed to eliminate the installation, configuration and maintenance costs associated with running complex stacks of software. A key concept that differentiates a virtual appliance from a virtual machine is that a virtual appliance is a fully pre-installed and pre-configured application and operating system environment whereas a virtual machine is, by itself, without application software."

The reality is that virtual appliances provide a direct route for traditional on-premises applications to be rapidly redeployed in a SaaS. This is typically done without major application re-architecture for multi-tenancy, which is a core tenant of SaaS.

Wikipedia also points out that an example of the virtual appliance approach to delivering SaaS is the Amazon Elastic Compute Cloud (EC2), which is a grid of Xen hypervisor nodes coupled with the availability of pre-packaged virtual appliances. The value of this approach is that it reduces the cost barrier to the point where it becomes feasible to have each customer of a hosted SaaS solution provisioned with its own virtual appliance instance(s) rather than forcing them to share common instances.

What's different from SaaS is that a virtual appliance can also be deployed on premises for customers that need local access to the running application. Many like this option, I'm finding, such as large corporations that have security requirements that a third-party hosting model does not meet. The underlying virtualization technology also allows for rapid movement of virtual appliance instances between physical execution environments. That's the core difference from SaaS and the value proposition you need to consider in any comparison.

What's key is that this approach offers another option to consume software and hardware resources virtually, and it provides some advantages over "traditional" SaaS. Thus, virtual appliances are another architectural alternative you should consider when considering SaaS and traditional computing. In fact, it's kind of a mix of SaaS and traditional computing and the best of both worlds, if you ask me.

David S. Linthicum is a managing partner with Zapthink, a consulting and advisory organization dedicated to SOA planning, implementation, training, mentoring and strategy. He is a well-known application integration and SOA expert who has authored 10 books on related topics. Write him at [email protected]What's different from SaaS is that a virtual appliance can also be deployed on premises for customers that need local access to the running application. Many like this option, I'm finding, such as large corporations that have security requirements that a third-party hosting model does not meet. The underlying virtualization technology also allows for rapid movement of virtual appliance instances between physical execution environments. That's the core difference you need to consider in any comparison to SaaS.