1. Application Service Providers

2. Introduction • Application Service Provider or (ASP) has a significant placement in the business world. • ASP provides customers with access to business application via Internet connection. • This has become more popular over the past few years and is still one of the most functional methods for IT outsourcing.

3. Overview • The ASP operates and maintains the equipment that run the application and also employs the people needed to maintain the application. • Most companies pay a monthly or yearly cost for the services. • For example, most of us pay for the use of an Internet Service Provider which gives us access to the Internet and e-mail. This is a prime example of an ASP.

4. ASPs in the Market • Businesses of all sizes benefit from the use of ASPs for web hosting service and email. • Especially for small businesses and startups, the biggest advantage is low cost of entry and short setup time. • Plus the pay-as-you-go model is often significantly less expensive for all but the most frequent users of the service.

5. IT roles and ASP customer Roles • It’s Typical Roles ASP Customer’s Roles • Plan Investments Specify application services needs • Build facilities Budget service costs and return on investment • Hire and train people Contract for services • Budget and track expenses Focus on your business, not IT • Select and procure systems • Select, procure, and test software • Work with vendors and providers • Hire integrators and consultants • Organize and define processes • Install systems and software • Develop software • Customize packages • Maintain systems and applications • Provide user support • Run the data center • Plan for the future

6. Advantages of ASPs • There are several advantages to using ASP’s. It will reduce their spending and the costs of keeping systems up. • ASPs also offer superior technical support which may be reason enough for most businesses. • All of this, for the most part, at a very low cost to the customer.

7. What Vendor? • Major application vendors have focused both on the Business Process and Outbound and Inbound Logistics. • These applications are functionally stable, businesses believe they could afford the long development cycles. • Because they are expensive and mostly big, only wealthy business customers could afford them.

8. Examples of ASPs • A Web hosting company - Companies like Verio and WebHosting.com provide a classic ASP scenario -- virtual Web hosting. These companies provide hardware, software, bandwidth and people to host Web sites for companies and individuals. Typically, they charge something like $15 to $30 per month for the service, and may host hundreds of accounts on a single machine. • An e-mail provider - A Web hosting company usually provides some sort of e-mail service with your Web hosting account. There are two other alternatives: • Free services such as Hotmail or Yahoo! Mail • E-mail server ASPs who run exchange servers, POP servers or IMAP4 servers and distribute them on a monthly-fee basis - For example, a company in the Raleigh area called Inter-path offers a complete e-mail solution at a rate of $8 per month per account (as of 4/10/2000). • The advantage of the second approach is that the e-mail address uses your company's domain name. • A fax providerE-fax provides a free fax service that delivers faxes to your e-mail box. This is a classic example of a free ASP.

9. What to Ask • How do customers access the software? • How are customer service issues resolved? • How secure is the data?. • How secure is the connection between the ASP and the user? • How is the application served? • How does the ASP handle redundancy? • How does the ASP handle hardware/software problems? • How does the ASP handle a disaster? • Who owns the data? • How can I get the data out if I choose to select a new ASP two years from now? • How can I move data between existing applications and the ASP?

10. Conclusion • The future of ASPs and their influence ,on anyone who is involved in IT and networking industries, is hard to envision. • However, there are going to be many interesting advancements to come with the industry and how it will be used and sold.

11. References • http://www.howstuffworks .com • http://www.microsoft.com • Factor, Alexander. Analyzing Application Service Providers. 2002. Prentice Hall. Palo Alto. • Rowe, Stanford. Telecommunications for Managers. Fifth Edition. 2002. Prentice Hall. Uppers Saddle River. • Weiss, Peter. They Do More Than Just Save Money. Information Weekly. Nov 2001, Issue 862.