The following Paragraphs are taken from the Government Design Manual:
Over the course of the next five years, Garner believe enterprises will spend $112 billion cumulatively software as a service (SaaS), platform as a service (PaaS) and infrastructure as a service (IaaS) [Gartner11]. Among the reasons given was a desire to reduce the Total Cost of Ownership (TCO) for products and services. A survey conducted by Gartner in 2H10 in EMEA with 90 respondents, established the primary reasons SaaS was being considered. The most common reason selected (with 48 out of 90 respondents) was: "…considered to be more cost-effective from a TCO standpoint than on-premises solutions."