The general opinion is that SaaS applications either offer little customization beyond themes, logos and some custom fields. The idea is that to achieve economies of scale and resource utilization you must sacrifice customization and certainly some single tenant applications moving to SaaS suffer from this limitation.
Some SaaS companies, most notably SalesForce.com have spent a lot of time and money on building customization into their product and even offer the development environment as a product all unto its own.
One of the attractions of open source applications like OpenBravo, Pentaho, Sugar CRM, etc. is that because they are open source, it is easy to make customizations without the burden of a proprietary API, SDK or hosting platform. You can do what you want with some programmers and some time and money.
Some of the commercial vendors that support these open source applications do an excellent job and actually make most of their revenues from support and customization with some pretty interesting modules and add ons from an "after market" for these customizations.
O4BO is bringing the low cost of SaaS to its subscribers without the limitation on customization of some SaaS applications. We are doing it by supporting the aftermarket on the applications and even the customization of the applications by the commercial vendors and by our partners that can do the professional services necessary.
SaaS AND Customization, that's O4BO.