Software as a service (SaaS) adoption is on the rise among small and medium-sized businesses, according to a published report by pcw.co.uk.  Current numbers say that 21 percent of small businesses and 31 percent of medium-sized businesses use SaaS, doubling the percentage from four years ago.

For those unfamiliar with SaaS, it is essentially the business-oriented equivalent of so-called “Web 2.0” applications targeted at consumers, such as Google Docs or Windows Live Workspace.  SaaS providers allow software to be installed in their own servers, which then customers will access through the Internet and pay for use, rather than pay for software licensing.  The model has proven to be cost-effective and efficient for small to medium-sized businesses with more constrained IT budgets.  However, as the report suggests, SaaS has yet to hit the “mainstream,” but there is continual growth as more established vendors begin to leverage the SaaS business model.