On Demand water heaters have an unlimited capacity, the water will never get cold. Tank water heaters have a limited capacity and will eventually run out of hot water.
On demand heaters are take up less space, however your hot water flow will be limited to the size of the on demand heater. They are also more expensive than tank heaters.
Tank hot water heaters will store water and keep it hot all the time. They loose heat through the tank wall. On demand heaters are essentially 100% efficient because they only heat water when it is needed.
You will experience energy and cost savings with a on demand water heater, however the savings isn't great. For a home you will save approximately $10 per person per year. However with a business that doesn't want the hot water to run out, there is a advantage to having a on demand system. Also some businesses use far less hot water then an average home, so a on demand system will provide even greater cost savings..