The savings you make when you get your software made by a developer

There are a lot of software products out there that companies are offering that are sold as SAAS (Software as a service) and they get to charge you monthly (in 2025 the global SAAS industry made $295 billion to $300 billion). We have many examples of this (The Adobe Suite, The latest Microsoft Office Suite etc.). There are also a lot of independent software products that are developed by individual developers (or a small team) and deployed on your servers or office and they charge you a one time fee for developing the software. It is kind of like getting a house constructed. You get it constructed once and it lasts a lifetime. You only have to pay for maintenance whenever necessary.

In many companies I saw that instead of relying on Jira/Trello and the related stack they prefer to use an MIS that they developed themselves. I wondered, why is that? When Atlassian is providing all these cool products at an affordable price then why go to the trouble of developing and maintaining your own MIS? Soon I realized that this saves cost. The SAAS will cost a lot when used long term but an in house (or on contract) developed software will justify its cost after a few years of use. Many people understand this and that is why we still have people giving contracts to developers for developing their in house software.

The instances when SAAS can be good are when you have to use them for a limited time. When you have to use a SAAS for a very long time (possibly as long as your company lives) the costs add up and they don’t look good. For individuals I think that SAAS are a very good option as they can just use them when they need and de-provision them when they don’t. This becomes very hard for companies and small to medium enterprises to do because their workforce becomes accustomed to the software.

The SAAS industry is going to grow because of the AI industry. This is mainly because not everyone is capable of provisioning the high powered servers and GPUs that are needed for hosting a performant AI agent. In this case the SAAS costs are justified as the monthly cost of the SAAS can never catch up to the cost of purchasing the GPUs and setting up your own infrastructure. So, the SAAS industry is not going anywhere even if small to medium clients get their software made in house (or on contract). It is just going to shift gears and offer AI services in the mix to justify their monthly prices (the global SaaS market will reach $1.25 trillion by 2034.).

While AI will make it easier for SAAS to sell it will also make it harder for them. The use of AI has enabled easier development of custom software solutions which makes the generic SAAS solutions unattractive to the small to medium business owner. The major field where SAAS can win is the field of having their own infrastructure (and AI services) and charging the customers for it.

In conclusion, it is better for small to medium business owners (or even large business owners) to get their software developed by a developer if that software is supposed to run long term and on minimal infrastructure (like your computer, multiple computers, mobiles or IoTs) and doesn’t require data centers to run. In case the software requires data centers (or cloud) then it is better to go with a SAAS.