What is software that requires a monthly subscription fee often called?

The term for software that requires a monthly subscription fee is commonly referred to as Software as a Service (SaaS). This model allows users to access software hosted in the cloud rather than installing and maintaining it on local devices.

SaaS applications are typically offered on a subscription basis, where users pay a recurring fee to use the software. This model provides several advantages, including automatic updates, accessibility from various devices and locations, and reduced upfront costs since there are often no significant initial purchases required.

This is in contrast to on-premises software, which is installed locally and often requires a one-time purchase fee, utility software, which is generally designed for specific tasks and may not necessarily follow a subscription model, and proprietary software, which refers more broadly to software that is owned by a company and not freely available for public use, regardless of its payment model. The subscription nature of SaaS is what distinctly characterizes it, making it the correct answer.