Definition: Application on Demand (AoD) denotes an enterprise application that is owned, delivered and managed remotely by one or more providers. The provider delivers an application based on a single set of common code and data definitions, which are consumed in a one-to-many model by all contracted customers, at any time, on a pay-for-use basis, or as a subscription based on usage metrics.

Explained:

• An application owned, delivered and managed remotely by one or more providers: If the vendor requires user organizations to install the application on premise using their infrastructure, then it isn't an AoD. AoD delivery requires a vendor to provide remote, outsourced access to the application as well as maintenance and upgrade services for it. The infrastructure and IT operations supporting the applications must also be outsourced to the vendor or another provider.
• Where the provider delivers an application based on a single set of common code and data definitions, which are consumed in a one-to-many model by all contracted customers at any time: Customers may be able to extend the data model by using configuration tools supplied by the provider, but without altering the source code. This approach is in contrast to the traditional application hosting model, in which the provider supports multiple application codes, multiple application versions or a customized data definition for each customer.
• On a pay-for-use basis or as a subscription based on usage metrics: Purchasing is based on a subscription (for example, per-user, per-month fee) or use basis (for example, allocating a certain number of transactions for a fixed time period). A perpetual license purchase isn't considered AoD.

These notes are extracted from Gartner Enterprise Application on Demand Web Letter available here, On reading this the question that arises is ....Is SAP CRM than Enterprise Application on Demand as defined by Gartner?

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Prashanth Rai