While the proliferation of ASP players is expected to continue for the short term, industry analysts expect to see consolidation over the next six to 12 months. In the meantime, potential ASP customers are left to sort out vendor confusion (see Industry Watchers Identify Four Types of ASPs sidebar). Who will ultimately be left standing when the ASP industry shakes out is anyone's guess. IDC's Mizoras has her own theory. The best ASP is the one that is great at partnering with players in all of the required disciplines for application delivery, she says, including network infrastructure, service and support, and application expertise.In their respective searches for the necessary industry-specific application services, the Parson Group and Digital Foundry Inc. turned to Portera Systems. Both firms are professional service organizations (PSOs), which provide their clients with consulting services, and Portera, a vertical ASP based in Campbell, Calif., caters primarily to PSOs. Portera delivers its ServicePort suite of applications on a subscription basis over the Web. Key ServicePort modules include managing opportunity, resources, knowledge, engagements, and operations.
|Industry Watchers Identify Four Types of ASPs|
Pure-play ASPs, like USinternetworking Inc. and Corio Inc., of San Carlos, Calif., which partner with one or many independent software vendors (ISVs) to offer applications.
Software vendors, like Peoplesoft Inc. and Oracle Corp., which partner with pure-play ASPs but also offer direct application services.
Service companies, like EDS, which partner with ISVs to offer application renting.
Networking companies, like PSInet Inc. and Cable and Wireless PLC., which are becoming ASPs. In many cases, ASPs are also the clients of these networking companies.
After engaging in a vendor search process that began in February 2000, the Parson Group ended up with a short list of two viable ASPs, the second of which Halicky declines to name. We knew we needed a solution that was scalable, and even though Portera was a new vendor with a new software solution, we liked the quick software development cycle they offered on the applications we access, says Halicky, noting that major releases come out about every four to six weeks.As a Web solutions provider and software development shop, Digital Foundry Inc. could have built its own project management and reporting application but opted to use its in-house technical talent on customer billings. Wes Stauffer, CFO and COO at the eight-year-old company based in Tiburon, Calif., chose Portera over some larger ASPs in September 2000. Portera's application suite is more closely designed to do what we need to do, he says. Furthermore, Portera met the company's search criteria by providing a cost-effective functional application that was Web-based and had an interface that could be easily used by management. Most importantly, Portera offered a basic software package, featuring project management, project reporting, invoicing, and reports, that provides Digital Foundry with exactly what it needs without the bells and whistles. From a cost perspective, Stauffer says his company is paying half of what it would have cost to develop and maintain the application in-house. To date, he notes that application availability has been very good. Digital Foundry has only experienced an occasional problem. Portera does an excellent job of notifying us when there is a problem, and we have a guaranteed response time in our SLA [service level agreement] when issues occur, Stauffer says. Important Business Functionality Like many companies that turn to ASPs, the issue of application customization came up for both the Parson Group and Digital Foundry. Customization was a major issue for us, and it's one of the things you give up when the application isn't truly yours, says Digital Foundry's Stauffer. For example, he says he would set up the approval routing system differently if he were designing the application. However, given choices on how to configure an application, customers can make their instance, or version, have the look and feel of a personal application. It's a trade off that companies make when outsourcing, but we feel the time savings is worth it, Stauffer adds.