This article appears here by permission. It was just two short years ago that the acronym ASP first appeared on the horizon of leading market research firms. Less than a year later, major data centers including Exodus, NaviSite, and AboveNet were planning their revenue growth on professional services to support Internet firms who host business applications including Microsoft Office, Siebel sales automation, and ERP applications from SAP and PeopleSoft. Essentially, an ASP is a vendor who makes applications available on a subscription basis. An application service provider manages and delivers application capabilities to multiple businesses from data centers across wide area network.
ASPs give customers a viable alternative to procuring and implementing complex systems themselves.
In some cases, ASPs even provide customers with a comprehensive alternative to building and managing internal information technology operations. This creates significant cost savings for customers, allows easy support, and provides an environment for simplified upgrades and future applications additions. ASP customers also are able to more precisely control the total cost of technology ownership through scheduled payments, rather than having to make large capital equipment investments with and manage complicated depreciation schedules. In addition to remote hosting, these solutions were configurable through a Web browser, making set-up, configuration, and maintenance much easier. Oracle now offers its own ASP solution for ERP services, hosting it along with the Oracle 8.i software rather than selling directly.