However, pricing might not be so fixed. If the number of users declines the ASP has a smaller customer base from which to amortize these costs. They may feel compelled to raise prices before the contract is up if a fixed price is not in writing. Renting one version of the application solves the version headache. For instance, your inventory database allows for a 27-character part number but the ASP's holds 18.
Business rules decide complexity.
And automated business rules are a fundamental component of CRM functionality. And it is intertwined with the pricing flexibility and complexity issues. The long-term cost is likely higher than owning. If ASP sales literature includes TCO and Return on Investment modeling, look closely at the assumptions built into the in-house verses rental cost comparison. Knotts says often times the IT shop will only identify incremental and not baseline costs.