Now you can also use the freely available image server IIPImage to deliver tiles from your TIFF files on demand, but still use the same viewer. This way the data from your digital repository can be used both for long-term digital preservation and also for online publishing.
IIPImage support for JPEG2000 format as the source raster image is scheduled for the next year by our grant.
IIPImage is quite easy to setup on your server which runs UNIX or Windows (now Microsoft IIS is supported too).
The default Zoomify viewer with tiles generated by IIPImage:
Fullscreen version of the same viewer
Behaviour for the user is practically identical to the images served from small static files from the disk. IIPImage has support for cashing and is already a mature project, used for example in labs of Louvre in Paris.
Your image is at the same time available also by an IIP protocol, therefore you can also use the native clients supporting this protocol. One of the best such viewers is a very nice AJAX based IIPMooViewer.
Development of Zoomify extension was done with our funding by Ruven Pillay, maintainer and developer of the IIPImage. Source code is now available in IIPImage SVN at SourceForge. It is going to appear in next stable version.
Note: a project j2ktilerenderer is also generating Zoomify tiles - from JPEG2000.