SaaS is an acronym that means “Software as a service.”
Usually, SaaS refers to subscription based applications in which a software application is accessed remotely via a web browser or other local client. The service provider maintains the application, and the customer doesn’t need to install, upgrade, or maintain the application on their own local computer.
For an example of Software as a Service, consider the two different ways you can use WordPress:
One the one hand, you can run WordPress yourself on your own shared hosting or VPS hosting plan. You control your hosting, and you install WordPress on it yourself. This gives you complete control over how you run your site and what you do with it.
On the other hand, you can get a free blog at WordPress.com. You don’t have to install the software or worry about upgrades. It’s easier, but you also have less control over your site and your content. WordPress.com is a SaaS application.