What is Device-as-a-Service (DaaS) Model: Benefits & Examples

Device-as-a-Service (DaaS) is a subscription model that bundles hardware, software, and device management for businesses, through which customers pay a monthly fee per user instead of purchasing devices outright. The DaaS provider takes care of everything from initial setup and deployment to ongoing maintenance, security updates, and data backups.
June 20, 2024

7

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What is Device-as-a-Service (DaaS) Model: Benefits & Examples

What is Device-as-a-Service (DaaS)?

Device-as-a-Service (DaaS) is a subscription model that bundles hardware, software, and device management for businesses. Similar to HaaS (hardware-as-a-service), under the DaaS model, companies pay a monthly fee per user instead of purchasing devices outright. The DaaS provider takes care of everything from initial setup and deployment to ongoing maintenance, security updates, and data backups. This frees up a company's IT department to focus on other tasks. DaaS also allows businesses to easily scale their device needs up or down as their workforce fluctuates.

Additionally, a DaaS solution ensures employees have access to the latest technology without requiring a large upfront investment. This can be especially helpful for businesses that require specific software or high-powered devices.

Device-as-a-service vs desktop as a service

Feature Device-as-a-Service Desktop-as-a-Service
Device type Laptops, tablets, smartphones Desktops (virtual)
Software included Operating system, productivity software (optional) Operating system, any additional software required by the user
Management Managed by the DaaS provider (hardware and software) Managed by the DaaS provider (software and desktop environment), the user's organization may manage hardware
Scalability Easily scales up or down based on user needs May require additional resources from the provider to scale
Upfront cost Lower upfront cost, predictable monthly fee May require a higher upfront cost for hardware, variable monthly fee
Security Managed by the DaaS provider, data resides on the provider's servers Security depends on the DaaS provider and the user's organization's security protocols. Data may reside on the provider's servers or the user's device
Typical Use Case Mobile workforce, employees needing various devices Secure, controlled access to work environment, resource-intensive tasks

Three dimensions of the DaaS supply chain

A well-oiled DaaS supply chain hinges on three key pillars: device fulfillment, device services, and device recovery.

  1. Device fulfillment - Device fulfillment acts as the backbone of the DaaS supply chain, ensuring devices reach customers efficiently. DaaS providers manage the entire process, from identifying requested devices and configurations to maintaining inventory or collaborating with manufacturers. This includes pre-loading devices with necessary software, security patches, and company settings before securely shipping them. Some providers even offer on-site setup or remote configuration assistance to guarantee a seamless user experience from the moment the device arrives.
  2. Device services - Device services form another critical dimension of the DaaS supply chain, extending far beyond the initial setup. DaaS providers act as a one-stop shop, offering ongoing maintenance and support. This includes help desk assistance for troubleshooting, hardware repair, or replacement to minimize downtime, alongside crucial security updates and software management to keep devices functional, secure, and up-to-date throughout their lifecycle within the DaaS subscription.
  3. Device recovery - Device recovery, the final stage of the DaaS supply chain, focuses on responsible end-of-life management to ensure data security and maximize device value. This includes securely wiping all user and company data to prevent breaches, physically retrieving devices from users, and then either refurbishing them for redeployment within the DaaS program or responsibly recycling them according to environmental regulations. This closed-loop system minimizes e-waste and allows the DaaS provider to recoup value from the devices, contributing to a sustainable and cost-effective DaaS model.

Device-as-a-service lifecycle

The Device-as-a-Service (DaaS) lifecycle simplifies tech management. Users select their devices, which are then configured for security by the provider before delivery. Throughout the subscription, performance is monitored, and adjustments are made as needed. Repairs ensure continued functionality, and finally, the provider handles secure data wiping and responsible device recycling or refurbishment. The DaaS lifecycle consists of:

  • Discover and design - Businesses and providers assess user needs, software, and budgets to choose optimal devices for the company's workflow. This sets the stage for a smooth DaaS implementation.
  • Configure - Providers pre-load devices with necessary software, security patches, and company settings. This ensures devices arrive ready-to-use, minimizing setup time for employees.
  • Deploy - Devices are securely shipped to employees, with some providers offering on-site setup or remote assistance. This ensures a seamless user experience from the moment they receive the device.
  • Optimize - Providers monitor device health, software updates, and user needs. Adjustments can be made, such as adding storage or swapping devices to ensure optimal performance throughout the subscription.
  • Maintain - Providers handle repairs, replacements, and troubleshooting to minimize downtime and ensure devices stay functional throughout the subscription period.
  • Dispose and refresh - Providers securely wipe user data, collect devices, and either refurbish them for reuse within the program or responsibly recycle them according to regulations.

Common device-as-a-service models

Product subscription or rental

In this common DaaS model, users pay a recurring fee for device access throughout the subscription term. This eliminates upfront purchase costs and allows for easy upgrades or replacements as needed.

Rent-to-own

"Rent to own" offers a twist on the DaaS subscription. Users pay a recurring fee with the option to purchase the device at the end of the lease term. This allows them to access the device without a large upfront cost while still having the possibility of eventual ownership.

Try-before-buy

"Try before you buy" lets users experience a device through a shorter DaaS subscription. This allows them to test functionality and suitability before committing to a full purchase. After the trial period, they can return the device or seamlessly transition to a regular subscription.

Upgrade through membership

"Upgrade through membership" provides access to the latest devices within a DaaS subscription. Users pay a recurring fee that allows them to upgrade to newer models at predefined intervals or when new technology becomes available. 

Pay-per-use

"Pay per use" offers a flexible DaaS option. Users only pay for the time they actually use the device. This is ideal for seasonal needs or occasional users, as they avoid fixed monthly fees and only incur costs when they require the device.

Examples of device-as-a-service

Mobile workforce management

A sales team needs constant access to laptops and tablets for presentations, customer relationship management (CRM) software, and video conferencing. DaaS provides them with the necessary devices pre-loaded with the required software and ensures ongoing security updates and maintenance. This allows the sales team to focus on closing deals without worrying about IT headaches. 

Healthcare professionals on the go

Doctors and nurses often require specialized devices like rugged tablets for patient consultations and electronic health record (EHR) access. DaaS ensures these devices are secure, compliant with healthcare regulations, and readily available at the point of care. Providers can easily scale the number of devices based on staffing fluctuations. 

Educational technology deployment

A school district wants to provide all students with laptops for enhanced learning, but upfront costs and ongoing IT management are major concerns. DaaS offers a solution by equipping students with laptops loaded with educational software. The provider handles device deployment and maintenance, and ensures data security for student information. 

Seasonal or temporary staffing

A retail store requires additional staff during peak holiday seasons. DaaS allows them to acquire the necessary laptops or tablets for temporary employees without a large capital investment. After the busy season, the devices are returned, reducing storage needs and ensuring responsible device disposal. 

Project-Based Tech Needs

A design firm needs powerful workstations for a specific project with a limited timeline. DaaS allows them to access the necessary high-performance computers for the project duration without a permanent purchase or the need to manage hardware after project completion.

Benefits of device-as-a-service model

  • Recurring revenue stream - DaaS creates a predictable revenue stream for providers with recurring fees paid throughout the subscription term.
  • Improved customer retention - By eliminating upfront costs and offering flexibility, DaaS can lead to higher customer satisfaction and encourage them to stay with the service.
  • Better customer touchpoints - DaaS fosters stronger relationships as providers manage the entire device lifecycle, creating more touchpoints for ongoing customer interaction and support.
  • Device lifecycle management - DaaS simplifies IT management by handling device procurement, deployment, maintenance, and disposal throughout the lifecycle.
  • Participation in e-commerce and/or circular economy - DaaS allows for easier integration with e-commerce platforms for device acquisition and promotes a circular economy by facilitating device refurbishment and responsible recycling.
  • Upselling and cross-selling opportunities - DaaS opens doors for upselling (for example, better devices) and cross-selling (e.g. accessories or software) throughout the subscription term.
  • Reaching sustainability goals - DaaS promotes sustainability by encouraging device reuse through refurbishment and responsible recycling at the end of the lifecycle.
  • Lower costs - DaaS reduces costs by eliminating large upfront purchases and offering predictable monthly fees, potentially saving on maintenance and disposal expenses.
  • Simplified tech stack - DaaS streamlines IT by managing devices and software, reducing the complexity of in-house tech infrastructure.
  • Better employee experience - DaaS provides employees with readily available, up-to-date devices, minimizing downtime and frustrations and boosting overall work experience.
  • Reduction of IT workload - DaaS frees IT staff by offloading device management tasks like deployment, updates, and repairs, allowing them to focus on more strategic initiatives.
  • Enabling the remote workforce - Device-as-a-service provides flexible access to equipment, allowing employees to work securely from any location.

Challenges of the device-as-a-service model

While Device-as-a-Service (DaaS) offers convenience, it can come with hidden costs. Over time, subscription fees can exceed the original device price. Additionally, control over the hardware is limited, making customization or specific software installation difficult. Businesses may also be locked into contracts with limitations on upgrades or early termination. DaaS providers might not always offer the latest models, and security can be a concern if data resides on devices not fully controlled by the company.

How to choose the best DaaS model for your business

Selecting the ideal DaaS solution requires a clear understanding of your company's needs. First, assess the software and operating systems your employees require. Then, consider if your workforce prioritizes persistent desktops with a familiar feel or if non-persistent, streamlined options suffice. Security is paramount, so research the provider's encryption, authentication, and compliance certifications. Finally, explore pricing models - metered access might be suitable for occasional users, while unlimited plans could benefit high-demand employees. By carefully evaluating these factors, you can choose a DaaS model that delivers optimal functionality, security, and cost-efficiency for your business.

How to get started with device-as-a-service with Xyte

Xyte streamlines the DaaS journey for hardware manufacturers. To get started with Xyte, first connect your devices to Xyte's cloud platform. This establishes a foundation for remote management and monitoring. Next, leverage Xyte's tools to create a custom-branded fleet management solution for your customers. This empowers them to remotely deploy, configure, and oversee their devices. By working with Xyte, you can be operational in short order, offering a complete DaaS package that strengthens customer relationships and unlocks recurring revenue streams through service subscriptions.

Conclusion

The Device-as-a-Service (DaaS) model offers a compelling alternative to traditional device ownership for businesses. It provides a predictable way to equip your workforce with the latest technology while streamlining IT management and potentially reducing costs. From enabling a mobile workforce to simplifying device lifecycles, DaaS offers a range of benefits. However, it's crucial to consider potential challenges like subscription costs and limitations on hardware control before choosing the right DaaS model for your specific needs. By carefully evaluating your requirements and exploring various options, you can leverage DaaS to empower your employees and optimize your technology investments.

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