It is software on the device. Be aware however, my experience has been that this is not generally an installable piece of software, but rather a piece of software included in the device "image".
This should be included in all new devices but if you are working with older devices it may or may not be an option.
The older devices will do more of a pull replication, however it does not work nearly as elegantly. Also, not all security policy features are supported.