True on-demand solutions like Centive Compel, built from the ground up as multi-tenant solutions - where a single instance of the software securely serves all customers - offer tremendous economies when compared to traditional "on-premise" systems.
With true, on-demand solutions, there is no hardware or software for the customer to purchase. Instead, the customer subscribes to a monthly service at a pre-defined subscription rate.
Traditional on-premise systems require the upfront purchase of a perpetual license agreement and an ongoing maintenance and support agreement. In addition, on-premise systems require the customer to invest in hardware and supporting software (for example, licensing Oracle or WebLogic). In addition, these systems require a significant investment in time from IT resources.
Centive has a detailed ROI calculator you can use to compare the first year and on-going costs of on-demand vs. on-premise compensation software solutions.