The company is already working with IBM Global Services and some smaller firms and has signed several customer deals for outsourcing its core OneWorld product line. Under J.D. Edwards' model, the outsourcer sells the services and pays a cut to them to use the software. Taking a different route is Oracle , which is hosting its own applications with Oracle Online. The company this week announced that it has signed its first dozen customers for its Business OnLine hosting service. The service provides applications to handle most business needs, including accounting, manufacturing, and procurement.
Customers pay a monthly fee to use applications through the Web or a leased connection.
Another big question is whether ERP companies will be hurt by lost software sales lost as more companies follow the outsourcing path. Mike Connolly, J.D. Edwards' business development manager for enterprise application outsourcing, argued that deals won't cannibalize the company's software sales but instead open a new distribution channel. Connolly argued that the cost of outsourcing cannot be easily compared to buying the software, as an ASP contract includes management, support, and help desk services. The company plans to target its outsourced services by industry, such as oil and gas, health care, and real estate. Inc. All rights reserved.