One of the fastest-growing segments of the IT and network industry is software-as-a-service. Companies looking to void the implementation and administrative hassles and costs of traditional, on-premises software are investigating an expanding array of Web-based applications. The meaning of on-demand varies among today's software-as-a-service products.

Software-as-a-service's primary appeal is it can be deployed quickly and used on a variable-fee basis. From a technology perspective, the new generation of net-native application services has been made possible by the spread of broadband networks and emergence of an assortment of enabling technologies and techniques, such as open source software and Asynchronous JavaScript + XML (AJAX). These tools have let some software vendors package and price their software-as-a-service products so that users can procure the applications in real time by pointing and clicking.

The poster child for software-as-a-service is Salesforce.com, with its CRM and salesforce automation products. The software-as-a-service market also includes things such as online accounting and supply-chain management.

Software-as-a-service even is permeating mainstream productivity applications. For example, if you're tired of relying on Microsoft, you can swap out Outlook and Exchange for HyperOffice's new HyperShare or BlueTie for business-class e-mail. Or you can take advantage of Web-based alternatives to Microsoft's Office applications, such as iNetOffice or Writely for word processing, Google or iRows for spreadsheets, and eProject or Projity for project management. You can even build your own database-oriented applications using Intuit's QuickBase.

The on-demand concept is taking hold among managed service providers (MSP), who are beginning to apply the point-and-click, Web-based procurement approach to various management products. For instance, Everdream recently rolled out an on-demand, managed desktop management service. Symantec is expanding its managed security service offerings based on the popularity of its consumer-oriented subscription services and growing interest among corporate customers.

While many software-as-a-service vendors and a few MSPs can call their offerings on-demand, there are many other independent software vendors and MSPs whose Web-based applications require upfront customization or integration support to such a degree they hardly qualify as on-demand. These products typically come with a minimum one-year service agreement to offset the initial start-up costs. Their providers say that after the initial deployment, additional application or managed service users can be added immediately because of their products' provisioning capabilities and ease of administration.

Given that the meaning and value of on-demand have become relative, it is important to understand clearly how the term is being defined to be sure the widening range of products you're investigating match your expectations.