This SaaS model is different from traditional on premises software in which the customer purchases software from a company and installs it themselves on their own computer. Examples of SaaS products and applications include Google, Shopify, Salesforce, Slack, HubSpot, Zoom and ServiceNow. 

With SaaS, instead of installing software themselves, companies are choosing to use SaaS applications and services because they are convenient to use. Any business that has an internet connection can take advantage of the convenience of web-based software. if you are a customer its a good idea to have a SaaS attorney review or negotiate the SaaS contract.

Typically, the only warranty that a SaaS vendor will offer is related to the Service Level Agreement and guaranteeing that the SaaS application will be available and up and running a certain percentage of time. This is known as the “uptime” requirement. A SaaS vendor should not warrant that its SaaS application will perform in a certain way or guarantee any type of results from using its product.

Typically, these happen when there has been a security breach or a third party’s intellectual property rights have been infringed.  Customers should demand that the vendor put indemnification language in the agreement to deal with these risks.