December 19, 2000, 3:10 PM — The buzz term du jour is application service provider (ASP), and rightly so. There are many compelling reasons why the time has come for this age-old, long-thought-dead concept.
As Frank Dzubeck pointed out in a recent opinion piece here, the idea of selling access to hosted applications is simply time sharing dressed up in modern garb. The difference, of course, is that the browser represents a universal client and today's high-speed infrastructure makes accessing remote servers more feasible.
Regarding the latter, the arrival of digital subscriber line (DSL) will give rise to boatloads of hosted applications that wouldn't have been possible without fat, reasonably priced access pipes. Doctors, for example, will be pitched packaged applications that, among other things, will let them view X-ray images captured at remote hospitals. DSL will simply be included in the monthly fee.
The question you have to ask when evaluating any hosted services is: How does the network add value to the application? There isn't a single answer, but the thought process will get you where you need to go. For example, companies such as US West would be glad to take over your Lotus Notes infrastructure. They'll move the servers into their net and maintain them, provision the clients, handle help desk
calls . . . everything you do internally today. The potential value is lower cost of ownership.
Web serving and electronic commerce are particularly attractive hosted applications because you can (or soon will be able to) pay as you go. Instead of overbuilding your own site to meet hard-to-forecast demand, Qwest says you'll be able to hand that off to a service provider that can give you 100M bit/sec worth of burstable throughput to the rack, expand or contract the CPU cycles you use on an as-needed basis, and scale storage in accordance with needs. What value do you put on that?
Oh, I forgot to mention -- the host will also keep all your software up-to-date and maintain the site 24-7. The host is also nicely positioned to add new multimedia features as they emerge.
It's fairly easy, as you can see, to get excited about the promise. A confluence of maturing technologies makes the time right for the ASP movement. This doesn't mean you'll off-load all applications to third parties, but it does mean it will become increasingly easy to identify the value of such offerings.