The document compares the costs and implementation of single tenant vs multi-tenant software architectures. Single tenant models require separate environments for each customer, increasing costs as the customer base grows, while multi-tenant models use shared infrastructure and resources to efficiently support multiple customers on a single environment. It then provides a calculator tool to help companies estimate the potential cost savings of migrating from a single tenant to multi-tenant model based on metrics like infrastructure needs, deployment efforts, and customer growth projections over time.

1. Single vs. Multi Tenant Cost
Comparison

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Single vs Multi Tenant – Key Differences
Single Tenant Multi Tenant
Any software can be delivered through single
tenant model. No change required in software
Software architecture should be designed for
multi-tenancy, in order to be able to serve
multiple customers at the same time
Each customer gets their own environment
(logically) isolated from other customers
All customers share a common infrastructure
environment
More environments are required as the number
of customers grow
Single shared environment can typically handle
hundreds of customers (depending on the
complexity and concurrency)
Can pick and choose the size of the environments
according to the usage by customer (tenant)
All customers (tenant) will get the same shared
resources. Differentiation is difficult
Please read the following blog for more information on
business differences between single and multi tenant model

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Single vs Multi Tenant – Key Driving Factors
Single Tenant Multi Tenant
Shortcut to get in to SaaS model of business
Maintenance cost and operational overhead in
single tenant model
Less budget
Legacy product
Experimenting SaaS market
Lack of technical expertise
Competitors offering in SaaS model
Domain doesn’t allow sharing of resources

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Single vs. Multi Tenant Calculator
SaaS model is extremely tight to operate from a cost perspective. Therefore, ISVs should
explore ways to minimize their cost and increase their GPM. Multi-tenant models are quite
attractive from the point of cost savings. However, there is lack of clarity when it comes to
the exact $ amount that can be saved between single and multi-tenant models. Cello has
come up with this tool to help organizations to find out the cost differences in operating
between a single tenant(hosted model) vs multi-tenant.
Free Calculator to measure the ROI in moving to Multi Tenant Model
http://resources.techcello.com/Single-vs-Multi-Tenant-ROI-Calculator
The following slides explains the various aspects that are considered to
arrive at the ROI for migrating from Single Tenant to Multi Tenant Model.

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Single Tenant Model Attributes
Effort includes the following,
• Packaging the software
• Backing up current version in
production
• Deploying the new version
• Database setup
• Compatibility/Smoke Testing
Identify the resources and effort required for Single Tenant Model
Yellow highlighted cells are the inputs you will be providing. For the purpose explaining the calculator
let’s take the above given values.

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AWS Rates
For the purpose of our comparison we are going to use AWS environment
rates, which are considered to be nominal. Moreover, we are only going to do
relative ($$$) comparison between single and multi-tenant models.

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Per Month Cost in Single Tenant Model
Unit Costing Per Month Total Cost Per Month
Web Server $ 131.04 $ 131.04
Application Server $ 65.52 $ 65.52
Database $ 452.88 $ 452.88
Caching Server $ 54.90 $ -
Monitoring $ 4.00 $ 12.00
Total Cost $ 661.44

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Per Month Cost Break-up - Single Tenant Model

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Cost Distribution By Resource - Single Tenant
Model

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Per Month Cost Break-up - Single Tenant Model

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Per Month Cost in Multi Tenant Model
Resource Cost
Web Server $ 10.48
Application Server $ 10.48
Database $ 28.05
Caching Server $ -
Monitoring $ 0.48
Total Cost $ 49.50

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Per Month Cost in Multi Tenant Model
• Based on the hardware
requirements given for the single
tenant model, the calculator
automatically identifies the type of
hardware required for the multi
tenant model
• It also determines the number of
tenants that can be hosted in the
given multi tenant environment
• In this example a Large instance is
chosen for all the server types
• Total tenants supported in this
environment is calculated to be 25
Total Cost of Multi Tenant environment
that can support upto 25 tenants
Cost of supporting 1 Tenant

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Infrastructure Cost Per Month - Comparison

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Cumulative YoY Infra Cost - Comparison

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Deployment and Release Cost - Comparison

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Total Cost Comparison

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ROI In Multi Tenant Model

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About TechCello
Techcello is a cloud-ready, SaaS Application
Development Framework
Can be used to,
Build new SaaS products
Convert single-tenant Apps to Multi-Tenant
Migrate on premise products to SaaS model
Cello framework is delivered as a set of libraries and
APIs that can be easily integrated to your product
Applications built using Cello can be deployed in
any cloud
Cello contains building blocks for developing,
monetizing and servicing your SaaS offering.

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TechCello – Flexible Architecture
TechCello supports all models of database multi-tenancy, there by allowing ISVs
to operate in a hybrid model.
TechCello offers an end to end SaaS Life Cycle Management Solution that can
help in designing, developing and managing the operations of your SaaS
product.
Using TechCello you can simply focus on building your product functionalities,
and TechCello can take care of the rest.
TechCello is tested and proven SaaS Framework, built exclusively to meet the
typical SaaS needs of your business and product.
TechCello offers more than 30+ modules covering all the basic engineering
blocks and operational modules.
Apart from saving significant amount of cost, your precious time can be well
spent on differentiating your product from competitors through unique product
features.

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Contact Us
http://www.techcello.com
sales@techcello.com