The Amazon EC2 cloud is gaining traction as a platform for hosting enterprise applications.

What's more, some vendors putting their applications on EC2 are suggesting it's a better alternative than the typical software-as-a-service approach.

SaaS is usually hosted software that's shared by multiple customers, which each pay a per-seat monthly subscription fee. Amazon EC2, however, was designed as a platform that lets users easily size server capacity up or down. Software is delivered via what's called an Amazon Machine Image (AMI), which can contain applications, libraries, data, and configuration settings.

Pentaho, a provider of open source business intelligence software, announced Monday the Cloud Computing Edition of its software on Amazon EC2. Customers will get the software via an Amazon Machine Image and pay based on what they use.

Pentaho customer Nutricia, a provider of notional supplements, is an early user of Pentaho on EC2. Nutricia found that EC2 provides "superior flexibility in pricing, capacity, and on-demand scalability" over other types of hosted offerings, according to Pentaho.

Earlier this month, open source ERP vendor Compiere announced its EC2 version, also called Cloud Computing Edition (a coincidence, or Amazon's suggested nomenclature?), and said the offering is "more flexible than SaaS." A typical SaaS deployment requires sharing an application with a vendor's other customers, Compiere noted, but on EC2, customers get a "private instance" that can be more easily customized and upgraded.

Other vendors offering some software via EC2 include IBM, Oracle, Red Hat, and Microsoft. Salesforce.com, meanwhile, has a deal with Amazon to handle some of the server and storage work for SaaS applications hosted via its own Force.com platform.

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