Content management vendor Xythos Software recently introduced an online version of its software aimed primarily at small and midsize businesses that lack the resources to install their own document and file management systems.

Xythos became the latest of several companies to offer content management via a software-as-a-service model, joining IBM, Ricoh, Xerox and others, says Tom Eid, a Gartner research analyst.

Xythos launched its software-as-a-service content management tool after polling officials at small businesses, who wanted a better tool than e-mail for sharing files, according to James Till, chief marketing officer for Xythos in San Francisco. Hosted e-mail services typically restrict the size of e-mail attachments, and small companies often don’t have the IT staff or budget to operate their own servers, Till says.

“E-mail is becoming a failure point,” Till says. “Being able to access and store and manage and share their documents over the Web in some method that doesn’t rely on e-mail is becoming a lot more attractive … That’s the fundamental reason we’ve introduced Xythos On Demand.”

Xythos’ pre-existing software products have about 2.5 million users, and about 100 companies have begun using the new online service, paying monthly fees based on the number of users and storage capacity. For example, a person can buy 5GB worth of storage space for $9.95 a month, while a company with 25 users can buy 25GB for $119.95 a month. The most expensive plan costs $499.95 a month and covers 100 users and 200GB.

Xythos keeps data secure by using encryption while content is transported from a company’s computers to the Xythos On Demand servers, Till says. Once the data is on the Xythos servers, a variety of access controls prevent unauthorized users from getting the data.

“We’ve been serving the United States Senate, the Department of Defense,” Till says. “We’re pretty familiar with what some of the stricter requirements are for data protection.”

Xythos On Demand generally has the same features as the software packages Xythos sells to large organizations such as the Senate and Department of Defense, Till says.

Employees at a company that uses Xythos On Demand can access documents and files using a Web browser or their desktop file manager. The service also allows a company to share files with people inside and outside its organization, and lets a company keep track of changes to documents and the identities of people who view them.