Recent internet technology development has enabled software to be delivered as a service, or well known as software as a service (SaaS). through SaaS, customers not longer need to purchase software license, instead they only need to subscribe and access it via internet connection. for service providers, SaaS adoption means they have to change their business focus form product-based into service-based, which requires ome fundamental change in several aspects. this research based on qualitative method case study, evaluates benefits and risks of SaaS adoption by service providers and study how the providers implemented SaaS solution to their on-premise application. the object of this case study is an electronic business letter management software namely e-office on demand. result of the study shows that service providers have successfully managed the risks of SaaS. however there are still some issues related to customization and integration in SaaS service. complementary product and partnership between indenpedent software vendor and system integrator give added value to the offered solution.