In addition, far too often the IT deliverable did not meet the specific requirements of the business. Today there are more cost effective choices. There are two types of service providers that are a result of the Internet explosion. These applications not only can be deployed quickly, but they can be quite cost effective. Since the ASP is providing applications across many customers, the cost to the individual business is driven down.
Cash flow is another important consideration.
In the old model, businesses would have to spend cash for hardware and software every three years or less to keep up with technology. In the ASP model, the customer pays on a monthly subscription basis, so no upfront cash outlays. The ASP is entirely responsible for refreshing the technology. Many applications such as e-mail, contact management, customer service and other applications are available through ASPs. This is accomplished at the infrastructure level through network and systems management services which are usually supported internally.