SaaS Agreement – FAQs -What is a SLA and Essential Terms to include in a SLA

A SLA forms part of a SaaS agreement. The SLA can be contained in a separate schedule to the SaaS agreement, or included in the main terms and conditions of the SaaS agreement. An SLA sets out:

Details about the availability of the software and services;
Technical details about hosting; and
Details about support and maintenance services for the software.

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SaaS Agreements – FAQs – What is SaaS and Essential Terms to include in a SaaS Agreement

SaaS is the abbreviation for “software as a service”. You may know this under another name, for example subscription agreement, software on demand, software subscription agreement, cloud computing or ASP services (application service provider). These names all refer to the same thing – software being made available via the Internet to users.

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SaaS Agreements – FAQs – What is a SLA?

SLA is the common abbreviation used for a service level agreement. When providing SaaS services to customers you need to include a SLA in your SaaS agreement, either as part of the main terms of your SaaS agreement or in a specific SLA schedule. A SLA should set out the following support and maintenance services that you will provide to customers to ensure that the SaaS software is made properly available to them.

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SaaS Agreements – SLA – Terms to Include

The above is a general guide to the terms to include in a SLA for a SaaS agreement. The degree of detail that you provide will largely depend upon the following:

The type of SaaS products and services you are supplying;
How much the customer pays for the SaaS product and services;
Whether the SaaS product is business critical i.e. online banking;
What is standard in that particular business area.

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SaaS Agreements – FAQs – Hosting

Under the terms of your SaaS agreement you will be storing, processing and publishing customer content and data on the Internet using servers located and operated at the data centre of a third party. The third party operating the servers is known as a hosting provider. The hosting services are provided from a data centre owned and operated by the hosting provider.

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SaaS Agreements – SLA – Data Backup

When providing SaaS services you must specify in your SaaS agreement who is responsible for the backup/loss of customer data. The extent of your backup duties should be included in the service level agreement (SLA) and these will be dependent on a number of factors set out below.

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SaaS Agreements – SLA – Security Issues

As a SaaS supplier you will have noticed the increasing concerns about security voiced by SaaS customers. Your SaaS agreement should provide comfort to your customer by including security provisions in the service level agreement (SLA). The specifc matters covered will depend on a number of factors set out below.

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SaaS Agreements – SLA – Error Fix Times

There are no standard fix times for remedying software errors, problems and bugs in a SaaS agreement. Fix times need to be tailored to the services being provided and should be set out in the service level agreement (SLA). The following factors need to be considered when SaaS suppliers establish fix times in their SaaS agreement.

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