SaaS and Subdomains

What is the advantage of using subdomains for a SaaS website?  Is there an advantage or is it just "the new thing to do"?

Like freshbooks and Basecamp do with something like

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Shalom CarmelCTOCommented:
the domain is your brand name.

If you have multiple services to offer, and do not want to dilute the brand, you use sub-domains.
It is also cheaper, and easier to manage.

Imagine that you start a new web based business called
You provide 2 unrelated services: virtual carpentry, and e-laundry.
Each service requires its own infrastructure. and  will not work, because this assumes a single infrastructure.

you are left with 2 choices, both work well, and choosing between them is a matter of preference and costs: and 

or and 

nutnutAuthor Commented:
Thanks for the response.  So as far as is concerned every customer gets there own  subdomain when they sign up, what is the advantage in that then, all customers get the same invoicing capabilty, why not just give them a username and password and all users use the same website?
Shalom CarmelCTOCommented:
because customers like to see their name on the url :)

in this case it is only a matter of preferences. They could use .
It is also a trifle easier for the saas application to extract the virtual host name than track the user organization in the session.

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nutnutAuthor Commented:
great answer thanks.  Other (less qualified) people have said it helps with SEO.  Could this be the case in your opinion?
Shalom CarmelCTOCommented:
not in this case.  What SEO do you need with a billing SaaS service?
these people are not necessarily less qualified, they may be more confused :)

In other cases, sometimes there is an advantage to use subdomains to improve standings, as google considers subdomains to be independent entities and ranks each one independently. You have to evaluate it though for each case.

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nutnutAuthor Commented:
Great answers thank you very much!
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