In this paper, we discuss the major issues associated with the new model of software delivery – service on demand – and explain why it alters the economics of software. As this model is expected to deliver fundamental leaps in cost efficiency, operation performance, infrastructure orchestration and application control, we describe the supporting technology required to achieve these goals. We also highlight those crucial operational processes for enhancing the quality of software delivery under the service on demand model. We then briefly outline our research roadmap to develop an on demand operating environment based on the fundamental principles: standardization, repetition, and, ultimately, automation.