A recent report by IDC (idc.com) showed worldwide revenues associated with the software-on-demand delivery model expected to hit $14.8 billion by 2011, representing a compound annual growth rate of 32 percent.

And THINKstrategies (thinkstrategies.com) reports that about three-quarters of organizations are either already using an on-demand software service or considering these new services.

Managed hosting provider Verio (verio.com) recently announced plans to target these trends by launching the Verio Business Solutions suite. The on-demand software offerings are designed to help SMBs overcome time and cost barriers presented by managing business applications and technology solutions in-house.

"We want our customers to depend on us to help them build their business online, not just with functional hosting solutions but also with these value-added services," says Dennis Boyle, chief operating officer for Verio. "The message we're trying to get out to the SMBs is that by partnering with Verio we're able to bring enterprise-level applications to them."

Through its on-demand platform, Verio will provide SMBs with access to hosted versions of a set of applications that includes Microsoft Exchange 2007, McAfee Total Protection, SugarCRM Professional and backup and productivity solution Accrisoft Business Applications.

The arguments for hosted applications such as these are fairly well documented by this point. Customers avoid the up-front investment involved in setting up in-house applications. They can pay on a monthly basis. Verio manages the applications and applies patches and software updates, while providing data backups and keeping the hardware behind the applications up to date.

"Through our partners and some of the ISVs that make up those partners - if we can create a marketplace with them and find applications we believe resonate with our retail channel," says Boyle, "then not only can they sell those products in the partner channel, but we can utilize those applications and form a strategic relationship with them and begin to offer their solution in our retail channel."

Perhaps the greatest benefit of the Business Solutions suite, says Boyle, is the potential for Verio's ISV partners to integrate their own applications into the system and deploy them via Verio's platform.

"Our partners have the opportunity to become their own business solution providers. We give them access at an application level and they're able to set up clients that they can sell on their sites," says Boyle. "So not only is Verio going into the marketplace as a business solution provider, we're also providing that same type of environment for our partners for them to do the same, and some of them have already."