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On-Demand Software
The MCC is an “on-demand” software platform.
The terms "on-demand", “Software-as-a-Service”, “ASP”, or “Live Software” are commonly used to describe software or IT services that are sold on a pay-per-use basis. In essence, on-demand software is a modern form of outsourcing, which many Fortune 1000 companies have been utilizing since the 1970’s with providers such as IBM and EDS. We use on-demand services every day. For example, instead of owning a distribution network for delivering and receiving packages, most companies outsource this service to Fedex or UPS and pay a low per-shipment fee. Likewise, most companies pay a monthly fee for the services of a long-distance phone provider, rather than building and owning their own nationwide fibre-optic network.
In recent years, many software providers, including Microsoft, SAP, and Oracle, have adopted the on-demand model using the Internet because it is an extremely practical and affordable way to sell and distribute use of their software. While traditional software providers require customers to purchase a software license outright, an on-demand supplier merely rents use of it for a fee. So, instead of buying or building major software applications and hiring a team to manage them, companies can now outsource some or all of their information technology (IT) needs to specialized software providers and merely pay per-use of the specific software services they require. In most cases, companies can “rent” comprehensive solutions for significantly less than buying, deploying, and supporting them in-house.
On-demand software providers are able to offer lower prices for use of their software because they amortize the initial and ongoing development costs over an infinitely wider audience. Typical on-demand software providers offer a pay-per-use option for individual purchases as well as a subscription-pricing option (monthly or yearly) for unlimited use of the software.
Other common features of the modern on-demand software model include:
- The software provider owns and operates the software application.
- The software provider pays for all capital expenditures required for application development as well as ongoing upgrades.
- The software provider employs the people needed to maintain and support the application.
- The software provider manages the servers that run the application.
On-Demand Advantages
For customers, the on-demand software model offers a number of attractive advantages. Many of these benefits are especially attractive to small and medium sized businesses for which an on-demand software is the only credible alternative to an in-house IT department.
- Eliminates significant upfront capital investment required for purchase or development of software - Pay only for the features that you need.
- Eliminates ongoing maintenance fees, such as royalties and upgrade costs.
- Removes the need for, and dependency on, an in-house IT department thereby significantly reducing facilities and HR costs.
- Enables significantly faster time-to-market.
- Gives Management better control over operations through cost predictability and scalability only as required.
- Enables users to focus on their core competency, rather than the technology behind delivery and upkeep.
- Provides instant access to latest upgrades and updates at no additional cost.
- Allows use of the application from anywhere in the world via the Internet and a web-browser.
- Extends the user’s reach by providing the most current and cutting-edge Web-based technologies.
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