Winging it on the ASP space odyssey

In February, the ASP community published its second survey of business opinion on the emerging applications services model

In February, the ASP community published its second survey of business opinion on the emerging applications services model

Simon Moores

Tech talk

(www.aspcommunity.org). While a little more encouraging than the last, the results suggest that, as an industry solution capable of inspiring universal business confidence, application service providers (ASPs) still have some way to go.

Business is now more aware of the issues, and the survey illustrates a growing belief that a tightly centralised, "software as a service" model may become a cost-effective alternative to existing client-server computing environments.

In late 2000, a survey from one of the industry's recent casualties, HOSTeu, found that 40% of IT directors could not name the main business benefits of using an ASP. This result appears to support the argument that ASPs should be considered more of a business than an overall IT proposition and that IT staff may prove to be reluctant partners.

There is a perception, particularly among analysts in Europe, that ASP remains better suited to the SME environment, if only because larger companies are, by nature, conservative and in most cases do not believe they have the flexibility necessary for an easy adoption of the ASP model.

If the ASP model is to attract more enterprise-size customers, then the research suggests that adoption is likely to arrive in "application chunks", starting with popular business productivity applications, such as e-mail and Microsoft Office. The more vertical the application, the more likely it is that resistance will be met.

The first six months of 2001 will prove to be a watershed for the industry. The technology has matured to a point where most objections can be dealt with. However, enthusiasts remain short of the numbers required to sustain many ASP business plans. As a consequence, a number of smaller companies may fall by the wayside and the larger ASPs and newer "soft telcos" will have to adopt an aggressive siege mentality; actively looking for new customers and partners while husbanding dwindling financial resources.

In the film 2001 - A Space Odyssey, the spaceship took a long time to reach its objective and by the time it had arrived, the mission had changed. Much the same could be said of an emerging industry which is on its own special odyssey, one which now looks unlikely to arrive in quite the same condition that it started.

Simon Moores is chairman of the Research Group

www.drmoores.com

This was last published in March 2001

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