The market for the new provisioning type Software-as-a-Service (SaaS) has reached a significantsize and still shows enormous growth rates. By varying size of SaaS products, providerscan improve their market position and profits by successfully acting in the tension area ofcustomer acquisition, pricing and costs. We firstly elaborate differences concerning productdifferentiation between classic software provisioning models and SaaS. Secondly, we introducea micro-economic based decision model to maximize the return of a provider by findingan optimal granularity, i.e. by varying the size of services. This paper makes two contributionsin this context: (1) it provides a conceptual foundation for product differentiation withinthe scope of SaaS and (2) it presents the first implementation of variable reproduction costsfor web based software offers. The model is illustrated by a real world case with data from aSaaS provider....