Mark and I just published, for nScaled, a new white paper on the business case for SaaS providers moving to cloud computing. If you would like to take a look it's available off the main site home page.
Brief Introduction
A 50% reduction in costs with an associated ten fold increase in available capacity has been achieved by various SaaS vendors migrating their infrastructure to Amazon Web Services and those of other cloud vendors. The competitive advantage of an impact of this magnitude on the business model is ignored by SaaS providers at their peril.
Thanks!
-Kent