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SaaS software (Software as a Service) is a software distribution model where applications are hosted and maintained by a third-party provider and made available to users over the internet. Users access the software and its features through a web browser, which removes the need to install and maintain the software on their own systems.

Licensed software is usually purchased and installed locally on users' computers or on a company's servers, and it often requires internal resources for maintenance and upgrades. In contrast, SaaS software is accessed via the cloud, which reduces maintenance costs and effort. While licensed software typically involves a large upfront payment, SaaS products are most often sold on a subscription model with lower, recurring payments.

Your SaaS application is hosted in the cloud, on your hosting provider's servers. This means users can access it from anywhere, at any time, as long as they have an internet connection. Cloud hosting also offers greater elasticity and flexibility, allowing your software to adapt to fluctuations in demand.

There are several ways to monetise a SaaS product. The most common is a subscription model, where users pay a recurring fee to access the service. Other approaches include freemium models, where a basic version is available for free and users pay for additional features, and usage-based models, where pricing depends on the resources or features consumed.