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September 1999 Edition 1.0 ASP CASE STUDIES Interliant: ASP fusion for the enterprise From the publisher of ASPnews.com and ASP News Review Farleit Limited

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  • September 1999Edition 1.0

    ASP CASE STUDIES

    Interliant: ASP fusion for the enterprise

    From the publisher ofASPnews.com andASP News Review

    Farleit Limited

  • ANATOMY OF AN ASP: THE NEW COMPUTING GENUS Contents

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    ABOUT THE AUTHORPhil Wainewright, managing editor of ASP News Review, is a leading analyst and globalauthority on the application services industry. He has tracked the sector full-time sinceautumn 1998, when he established the ASPnews.com web site as the primary source ofnews and analysis of the emerging ASP industry, and launched the ASP News Reviewnewsletter. He is a regular speaker at major ASP conferences in the USA and worldwide,and since 1994 has written regularly for leading US Internet and European IT publications,specialising in enterprise computing and the impact of the Internet. He previously spentalmost a decade in marketing and product management in a variety of roles in the UKcomputer industry.

    ABOUT THE PUBLISHERFarleit Limited is an Internet-based publishing venture which aims to combine traditionalinformation publishing values with the best of the opportunities offered by Internettechnologies and the World Wide Web. Founded in 1998, Farleit operates ASPnews.com,the online source of global news and analysis for the ASP industry, and publishes the ASPNews Review newsletter and other titles on ASP issues.

    This report published 1999 by

    Farleit Limited12 Prince Regent MewsLondon NW1 3EWUnited Kingdom

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    Farleit Limited 1999. All rights reserved.

    ABOUT LICENSINGThe publisher has granted full joint exclusive rights to Interliant Inc of Purchase NY, USA, torepublish this report both electronically and in print. Farleit Limited retains the right topublish the report under its own imprint. In both cases, the report is distributed under a freeof charge licence, which allows users to pass individual electronic or printed copies on toothers for their information. However, persistent or volume redistribution, and any form ofcommercial redistribution for profit, constitutes a breach of copyright unless the prior writtenpermission of the publishers has been sought and obtained. For full terms and conditions,see http://www.aspnews.com/terms.htm

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    Contents

    INTRODUCTION...............................................................................................................................4

    CREATING ASP FUSION .................................................................................................................5ASP MARKET TRENDS ..........................................................................................................................5

    Acceptance of outsourcing............................................................................................................................5Need for speed.............................................................................................................................................6Commerce gets wired...................................................................................................................................6

    ASP TECHNOLOGY TRENDS ..................................................................................................................7Universal IP networking................................................................................................................................7Development of server-based computing......................................................................................................7Distributed systems management.................................................................................................................7

    THE EMERGING ASP SPECTRUM ............................................................................................................8Webtop applications.....................................................................................................................................8Subscription outsourcing...............................................................................................................................8Application server hosting.............................................................................................................................8ASP aggregators..........................................................................................................................................9

    INTERLIANT AT THE ASP FRONTIER ........................................................................................................9Current offerings.........................................................................................................................................10Future directions.........................................................................................................................................11

    AN ASP MENU FOR THE ENTERPRISE ........................................................................................12ASP CONVENIENCE............................................................................................................................12

    Economies of skill.......................................................................................................................................12Budget friendly...........................................................................................................................................13A flexible friend...........................................................................................................................................13Network ready............................................................................................................................................14

    ASP-READY BUSINESS ENVIRONMENTS................................................................................................. 14ASP APPLICATIONS FOR THE ENTERPRISE ............................................................................................15

    E-commerce...............................................................................................................................................15Customer relationship management (CRM)................................................................................................. 16Enterprise resource planning (ERP) and accounting....................................................................................17Messaging and collaboration.......................................................................................................................17Distance learning........................................................................................................................................18Instant applications.....................................................................................................................................18Vertical market applications.........................................................................................................................19

    EVALUATING THE PROVIDER ................................................................................................................19Fitness for purpose.....................................................................................................................................19Subscriber management infrastructure........................................................................................................19Technology infrastructure...........................................................................................................................20Support infrastructure................................................................................................................................. 21

    ASP DELIVERY CHANNELS...................................................................................................................21APPLICATION SERVICES STRATEGIES ....................................................................................................22

  • ASP CASE STUDY: INTERLIANT Introduction www.interliant.com

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    Introduction

    The second in our occasional series of reports highlighting individual application serviceproviders turns the spotlight on one of the industry's earliest successful pioneers at animportant juncture in its development.

    In previous reports, we have described how the ASP model - in which a provider deliverspay-as-you-go applications and automated services from an online data centre - hasdeveloped from three separate strands of computing. It is rare, however, to find any ASPswhere all three of those threads co-exist.

    Interliant Inc, the subject of this report, is a notable exception, with roots both as an ITservice provider and as a web hosting provider, and with early experience of operating anInternet application portal. We believe its evolution of those three separate threads into anintegrated online application service offering provides valuable pointers to the likelydevelopment of the ASP industry as a whole. This short report puts that evolution intocontext and, using Interliant as a case study describes some of the implications in terms ofcustomer choice and ASP industry practice.

    As the publisher of ASP News Review and the ASPnews.com website, Farleit Limitedtracks ASPs all over the globe. This series of occasional reports focuses on specific,individual examples one at a time. We do not expect to issue more than four or five ofthese ASP case studies in any given year, choosing our subjects carefully to highlightdifferent aspects of ASP methodology, technology and business models.

    Once each report has been completed, we will often, as in this case, grant a publishinglicence to the provider concerned. Obtaining a commercial income in this way helps to fundthe resources required to prepare these reports, and enables us to make them availablefree of charge to visitors on our own web site. We always make it clear from the outset tothe subject that we will maintain an independent editorial stance. Publishing licencepartners have no editorial control and understand that, in the event that they disagree withour conclusions, their only recourse is to decline to purchase the licence.

    We hope you enjoy this report from the publisher of ASP News Review.

    London UK, September 1999

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    Creating ASP fusion

    A convergence of technology and business trends has brought a new means of acquiringcomputing within the reach of enterprises today. The past year has seen the emergence ofa new breed of business computing provider, the application service provider (ASP). Thisnext-generation information technology services company delivers computing to customersfrom a network-based data centre. Enterprises no longer have to own or operate thehardware and software on which their business computing runs. Instead they pay a fee tothe ASP according to usage, typically on a monthly subscription basis.

    Little more than a year after it first came to light, this rapidly-growing IT delivery channel isalready entering a new phase of development. This chapter reviews some of the marketand technology trends that have brought us to this point, and describes how the spectrumof ASP choice is evolving as various lines of development converge. We conclude with abrief account of how Interliant in particular has brought about a fusion of separate traditionsin its own recent history to offer an integrated set of ASP choices, foreshadowingdevelopments that we expect to see in the wider market. The following chapter describesthe potential impact of application service provision on enterprise IT strategy, and providesan assessment of the principal choices ASPs are making available to enterprises,Interliant's ASP offering as an illustration.

    ASP MARKET TRENDSSeveral separate market trends have fostered the emergence of online application servicesas a viable option in mainstream enterprise computing.

    Acceptance of outsourcing

    The concept of outsourcing is increasingly accepted in business today. Management gurusand investors alike emphasise the merits of concentrating on core competence, and ofbringing in outside specialists to perform all non-essential functions.

    Within the IT landscape, evolution in technology has enabled outsourcing to become muchmore selective. Many businesses now outsource specific elements of their total ITinfrastructure to an outside service provider, including the provision and operation of thedata network, the monitoring of service levels experienced by users, and increasingly theprovision of specific applications themselves.

    The spectrum of application services now available as a managed service ranges fromsimple website design packages, passing through hosted email and messaging, right up tohigh-end enterprise resource planning (ERP) applications. This new wave of outsourcedapplication services is typically priced on a per-user, per-month subscription basis.

    Such developments have been encouraged by an increasing trend among IT departmentsto view themselves as internal service organisations, tasked with understanding keybusiness issues and finding solutions to them. Outsourcing allows such groups toconcentrate on delivering strategic business value, leaving everyday operational issues inthe capable hands of an external provider. For smaller enterprises, the issue is a lack ofknowledge and resources to deploy and operate the new technologies they need to retaintheir competitiveness. Outside providers can bridge that gap between the possibilitiesbusiness owners perceive and the practical inaccessibility of today's business applications.

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    Need for speed

    The fast-moving pace of both business and technology today puts increasing pressure onscarce skills and resources. Applications are growing more complex, the businessenvironment is more competitive, skilled staff become more difficult to train and retain,while costs continue to be under tight control.

    The IT industry's response to these factors has been to increase the extent to which itpackages its products ready for use. Even high-end enterprise applications are nowpackaged and delivered with templates that provide an immediate starting point forimplementation. The race is on to slash implementation timescales.

    Application service providers aim to devise methodologies and templates that short-cutimplementation even further, down to weeks and days. This process drives applicationstowards an off-the-shelf, easy-configuration state that lends itself to online delivery as anInternet-based service.

    Commerce gets wired

    Businesses today fully accept the need to 'get wired'. The prevalence of e-commerce ande-business capabilities within enterprises, already well established in North America, is nowspreading into Europe and the Asia Pacific region.

    This is not just about companies having a website from which they present staticinformation or passively sell to consumers. Web servers have become dynamic, reacting touser input and providing an increasingly personalised experience, and in the process theyhave proven their ability to host a wide range of sophisticated applications.

    As a result, today many aspects of enterprise computing are moving to an Internet-centricmodel.

    Electronic commerceElectronic trading and communication with suppliers and customers up and down thevalue chain is allowing businesses to realise huge economies and efficiency gains inapplications such as electronic procurement, customer relationship management andsupply chain collaboration.

    Enterprise portalsBusiness applications are moving towards an enterprise portal concept, in which theuser has access to relevant information feeds and other services as subsidiaryapplications running in a browser window alongside the core product.

    IntranetsThe company intranet is becoming the default platform for delivering enterprisecomputing. Many organisations are moving their entire computing infrastructure onto anintranet architecture, using Internet technologies to distribute applications andinformation within the enterprise.

    ExtranetsSimilarly, the move towards giving customers, partners and suppliers access tocompany applications via a browser interface is making web-based delivery a growingfeature of external communications. In this context, larger enterprises are themselvesbecoming application service providers to their suppliers and customers.

    Many businesses rely on outside providers to operate the infrastructure for these newcomputing architectures. Internet service providers and web server hosting providers whostarted out hosting static Web servers have grown in expertise and scale as theircustomers' needs expanded. They are often better equipped than their customers tohandle the delivery of applications across a wide area network as a 7x24 operation.

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    ASP TECHNOLOGY TRENDSVarious emerging technologies over the past two to three years have combined to makeapplication services a cost-effective and accessible option today.

    Universal IP networking

    The advent of the Internet has demonstrated the viability of a simple, open, platform-independent network protocol that delivers both content and applications to users cheaplyand easily. The Internet's underlying Internet protocol (IP) is becoming the default standardarchitecture for all forms of telecommunications. Meanwhile, the laying of high-capacityfibre optic networks throughout the developed world has created an oversupply ofbandwidth that telecom providers are eager to fill. These two trends together haveconverged to create an all-purpose, global telecoms infrastructure based on IP technology,for which the cost of access is falling steeply.

    The benefits of IP are not limited to cost and availability. Developers have had many yearsto create additional services to sit on top of the IP infrastructure, with the result thatfunctions such as security, user profiling and network management are now highlyadvanced. Security is a particularly important consideration when users are accessingapplications and data across the open Internet. Technologies such as the secure socketlayer (SSL) in the web browser, public key infrastructure (PKI) to authenticate users andvirtual private networks (VPNs) to secure transmissions, each provide varying levels ofsecurity to meet stringent user requirements. These technologies are now reliable, provenand affordable.

    Development of server-based computing

    Cheaper, more plentiful telecommunications have in turn encouraged the development ofserver-based computing architectures, which are designed for environments where clientcomputers access centralised servers across a telecommunications link. In a server-basedcomputing architecture, most of the data storage and application processing takes place onthe central servers, while the client computers are mainly concerned with acceptinginstructions from the user and displaying the results. A welcome side-effect of server-basedcomputing architectures it that they tend to be easier to manage and less wasteful ofresources than PC-centric client-server approaches.

    The most widespread example of server-based computing is the worldwide web itself, inwhich central servers hold all the content and applications, while clients access them usinga web browser. Various technologies have been evolved to run applications centrally on theserver including not only CGI, Perl and Java, but also Microsoft's Windows DNA(Distributed interNetwork Architecture) and a wide range of application server platforms.

    Another variation on server-based computing is Windows terminal technology. This allowsWindows applications to run on a centralised server, sending just the user interface acrossthe network either to a dedicated Windows terminal or to a general-purpose web browser.

    Distributed systems management

    Easier connectivity has revolutionised systems management, enabling computer systems tobe monitored, managed and even repaired across a phone line. This has been a majorcontributor to the emergence of selective outsourcing, enabling reliable remotemanagement from a centralised enterprise operations centre. Using today's applicationmanagement solutions, it is now possible to track the application performance actuallybeing experienced by a user from the opposite side of the globe, and to drill down and

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    examine the performance of any of the individual routers, servers or applications that affectthe overall experience perceived by the user.

    THE EMERGING ASP SPECTRUMThese market and technology trends have combined to enable the application serviceproviders we see coming to market today. They offer a broad spectrum of solutions,operating models and delivery choices.

    Webtop applications

    The largest volume of applications delivered online today have been developed from theground up as Internet-based offerings and are provided either free or at a very lowsubscription cost. Examples include email and collaborative apps, file and documentstorage, web and e-commerce site builders, simple desktop productivity tools, and otherstailored to meet more specialist needs. Often, users can sign up online using a credit cardor other electronic payment method and begin using them straightaway.

    Software-based online business services are another important category. Using Internetcomputing, these dot-com operations cost-effectively offer a volume customer baseanything from electronic purchasing to specialist professional services.

    At present, there are very few examples of core enterprise applications being offered in thismodel. This is because established software products have to be re-engineered for Internetdelivery, while startup brands are still building up their offerings. Furthermore, customersexpect a significant degree of individual configuration of enterprise apps. The result is thatASPs must spend time preparing them for delivery, imposing an upfront cost that has to beeither paid in advance or recovered over an extended contract period.

    Subscription outsourcing

    The model for the provision of high-end application services takes existing enterprisesoftware products and offers them as outsourced applications on a subscription basis. TheASP tailors an application to the customer's requirements, purchases the necessarysoftware and hardware, and the customer signs a three- or five-year contract to receive theapplication as a managed service. ASPs have established relationships with lease financeproviders who amortise the upfront implementation and purchase costs across the life ofthe contract.

    In this way, established enterprise-class applications from top-tier vendors such as SAP,Peoplesoft, JD Edwards and others can be offered for a fixed per-user, per-monthsubscription payment basis across the life of the contract, avoiding the high upfrontcommitment required for a conventional purchase. Setting the payment as a per-user figurehas the extra benefit of relating the monthly sum to actual consumption in a transparentand predictable manner.

    Application server hosting

    As web sites have become more and more sophisticated, what started out as the provisionof web and mail servers to business customers has ended up as a highly sophisticatedmanaged infrastructure offering. In the process, web hosting providers have turned intoapplication service providers.

    In the enterprise market, hosting providers have been drawn into providing increasinglycomplex intranet, extranet and Internet servers for their customers, often taking care of theprovision, implementation and management of the server rather than simply providing data

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    centre space. A number have extended the principle to other networked applications suchas Exchange and Notes email and messaging systems. Today, such providers areresponsible for complex, mission-critical e-commerce and e-business applications on behalfof their customers.

    Other providers have preferred to evolve their web hosting services to concentrate onmanaging server farms for dot-com enterprises and other application service providers,turning into ASP infrastructure providers (AIPs). In the always-connected online world of theInternet economy, partnership is becoming increasingly important, and few ASP offeringsare the product of a single entity that owns every element of the solution. In many cases,separate providers take care of implementation, application management, subscribermanagement, server hosting and connectivity - but each works closely with the others toensure the customer experiences a seamless, reliable service.

    ASP aggregators

    As more and more applications become available as online services, a new type of ASP isbeginning to emerge, one that integrates multiple applications into a coherent, aggregatedoffering. High-end ASPs are starting to build up portfolios of complementary enterpriseapplications, while at the entry-level, online portals are gathering together collections ofapplications and business services to meet a particular market need. Even some banks andtelecom companies are becoming ASP aggregators to offer services to their small businesscustomers.

    In some cases, end users will want to be their own aggregators. But a majority will prefer toleave the integration headaches to specialists, taking to heart the ASP message whichpromises to relieve them of the need to develop in-depth technology skills.

    INTERLIANT AT THE ASP FRONTIERInterliant's twin-track history has brought about a unique blend of ASP expertise within thecompany.

    One half of its dual pedigree stems from leading US web hosting provider Sage Networks,which acquired the original Interliant company in March 1999, and adopted its name. SageNetworks, founded in late 1997, grew rapidly from its inception through the acquisition of aseries of web hosting companies scattered across the United States. In the process itamassed a substantial catalogue of expertise in website, e-commerce and intranet hosting.

    The second strand stretches back to 1993, and represents probably the most extensivecontinuous record of application hosting by any ASP in the industry today.

    In 1993, Interliant began developing a Notes system that would act as a messaginggateway, hosting infrastructure and online community for Notes users and developers.

    In January 1994, the system went live with almost 80 separate companies, all using thesame shared Notes server - the first such deployment of Notes.

    During 1993 to 1996, Interliant built up a substantial business hosting private Notes'extranets' for large enterprises such as Compaq Computer. It also began hostingapplications developed by Lotus Domino partners.

    In 1996, it began work on an add-on package for Domino that would support onlinerental of hosted applications.

    In January 1997, the company adopted the Interliant name and introduced ASP-stylepricing models for its Notes hosting and email services, quoting a flat fee per user.

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    In June 1997, Lotus launched Instant!TEAMROOM, a browser-accessed, hostedcollaborative application, and Interliant became the first provider to offer it. At the sametime, Lotus announced that it was working with Interliant to co-develop Instant!Host,following on from the work on supporting rented Domino applications that Interliant hadstarted the previous year.

    In January 1998, Instant!Host was released to developers.

    In September 1998, AppsOnline.com went live, offering a selection of Domino-basedapplications for online rental, including Instant!TEAMROOM, now in a new version thatused Instant!Host for subscriber management. A number of other Lotus partners,including Telia of Sweden and Bell Emergis of Canada, began offeringInstant!TEAMROOM as an online rentable application, also using Instant!Host tomanage subscriber accounts.

    In January 1999, Interliant began introducing other application server platforms besidesDomino into the AppsOnline.com environment.

    The chronology demonstrates five years' experience of Notes/Domino hosting, a leadingrole as an instigator and pioneer of work to make the platform shareable between multipleclient companies, and more than three years grappling with the complex issues involved inoffering applications for online rental over the Internet. Interliant has built up a formidabledepth of experience in application service provision.

    Current offerings

    Having completed its merger and then listed on the NASDAQ stock market in the first halfof the year, Interliant enters the final quarter of 1999 with a well-defined ASP strategy readyfor execution. It has invested significantly in evaluating and preparing new applicationofferings from a broad range of vendors who work closely with ASPs. As well as itstraditional Lotus Domino hosting platform, it is now adding Microsoft Windows DNA,Oracle8i and Unix platforms. Meanwhile, it has brought significant new data centre andnetwork capacity online, with advanced application hosting data centres now operational inAtlanta, Georgia, Houston, Texas, Washington DC, and another coming online shortly inthe UK. All have high-bandwidth OC3 and DS3 connectivity to tier one backbones and arepositioned to collectively provide excellent coverage of both Europe and North America.

    Interliant's ASP solutions fall into two principal categories, as described below.

    Packaged enterprise applications

    This is a range of customisable, subscription-based outsourcing solutions targeting mediumto large enterprise customers. Initially, Interliant will offer applications focussing on fourdistinct areas - e-commerce, customer relationship management (CRM), distance learning,and messaging and collaboration. Over time, its aim is to build up a portfolio of branded,Internet-enabled applications to cover a complete range of enterprise needs.

    A fixed per-user, per-month fee will cover all implementation, consulting, licensing, supportand operational costs, delivered in accordance with predefined service level agreements.Prices will range from $100 per user per month (prices quoted are in US dollars).

    The provider will work with systems integrators, software vendors and their reseller partnersto reach a broad market penetration, and aims to establish a formal channel programme forits application services, with joint marketing and sales programmes in place.

    Self-service web applications

    The establishment of a distinct line of enterprise application services leavesAppsOnline.com free to concentrate solely on rentable web-based applications. It will now

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    act as an online source of application services that users can sign up for and use instantly.The aim is to make the applications as self-service as possible, with support for on-linecredit card purchase, end-user training and other automated, instant-access features.

    The target market will be small to medium sized businesses, with a focus on specialist orvertical markets such as accounting, legal, engineering, freelance professional servicesand the technology industry. The intention is to provide a mixture of resources that helpmanage every aspect of a small business, eliminating the need to install and maintaincomplex in-house IT systems. Ranging in price from $15 to $50 per user per month, theonline offerings will provide a mixture of applications, business services and onlineinformation resources designed to meet the needs of the target market.

    A selection of new applications are waiting to be unveiled at the time of writing, includingLotus QuickPlace, the long-awaited replacement for Instant!TEAMROOM.

    Future directions

    Few ASPs have been marketing online business application services for as long asInterliant. It is unique in combining over five years' experience of providing managedhosting services for enterprise messaging and server-based applications, as well as havingan extensive background as a web hosting provider. It should not therefore be surprising tofind it pushing ahead into new frontiers of application service provision.

    The range of services and ASP delivery models that it has at its disposal gives it anunrivalled opportunity to pioneer the way forward for the emerging class of ASPaggregators. Most of its peers offer either high-end enterprise applications or entry-levelWeb-based self-service apps. Interliant is several steps ahead of the game in offering bothat the same time from a single source.

    To realise the opportunity, the company must avoid falling into the error of believing thatAppsOnline.com is its offering for micro-businesses and small enterprises, while largerbusinesses are served by its high-end enterprise application outsourcing. Instead, it mustview the two as part of a single integrated portfolio, giving its customers the opportunity toaccess any combination of application services according to changing requirements,without the need to establish additional relationships with new providers.

    High-end application outsourcing customers will always have instant access to low-end off-the-shelf services from AppsOnline.com. Meanwhile, the exposure that AppsOnline.comreceives on the web will be an excellent business development tool for the company,bringing in a constant stream of new customers who could become candidates for moresophisticated enterprise applications. As well as building relationships with smallercompanies who may in time grow to need enterprise-class ASP services, AppsOnline.comwill allow Interliant to show off its ASP offering to larger businesses that rent point solutionsfrom the portal.

    Interliant should also consciously link AppsOnline.com into its customer service and supportinfrastructure, using the self-service configuration, payment, training and supportcapabilities that it develops for the site to bring greater efficiency and convenience to itsenterprise ASP procedures. Later, it may prove possible to create links in the otherdirection, for instance adding hotline support options to the online rental offering usingWeb-based telephony and collaboration tools to put users in touch with live support agents.

    Behind the scenes, it should work to develop integration between the various applicationson offer, implementing common data structures where possible and ensuring that users caneasily transfer company data, user profiles and business policies from one app to anotherwithout having to re-enter information. This will increase the convenience for customers ofadding extra applications to their configuration, at the same time as cementing therelationship with the provider.

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    An ASP menu for the enterprise

    Enterprises today must add online application services to the list of options they examinewhen considering the acquisition of additional, new or replacement computing resources.The ASP model is technically stable, commercially viable and increasingly accepted as amainstream business practice. It will not always be the most appropriate route, butexperience has shown that there are a number of specific applications and businessenvironments where it is increasingly likely to provide the most effective solution.

    This chapter reviews the factors that make application services most relevant to anenterprise computing strategy, and provides an overview of the range of application typescurrently offered by ASPs, with particular reference to Interliant's developing portfolio.

    ASP CONVENIENCEThe ASP method provides a means of supplementing existing resources without significantdelay or the need to commit large amounts of advance funding. It provides access to skillsand technology investments that may otherwise be out of reach. It is also uniquelydisposable - what has been added can easily be taken away again once it has served itspurpose. These generic features have relevance to some very specific issues in enterprisecomputing today.

    Economies of skill

    One of the most pressing issues for CIOs today is the extreme difficulty of recruiting,training and retaining staff. The headache is exacerbated by the accelerating complexityand pace of change in information technology.

    The use of online computing services alleviates the skill shortage by tapping into externalpools of expertise and economies of scale in systems management. Most ASPs canoutperform in-house solutions because of several inherent advantages:

    They can employ an advanced, automated systems management infrastructure,spreading the cost of the investment across all of their customers

    The application is already implemented and operational within their infrastructure so anyteething problems have been tackled and resolved

    Since they serve the same applications to multiple customers, they have alreadyencountered and solved most of the common setup and operational quirks of thesoftware and can utilise proven best practices

    The cost of expensive, highly trained staff is similarly shared across many customers,and those staff have more incentives to stay with an ASP than the average enterprise isin a position to offer. They get to deal with the latest applications, a large-scaleimplementation and a broad variety of customer types, plus they can look forward to acareer path within the organisation

    As a high-volume user of the application with a recognised high level of technicalexpertise, an ASP can expect to have close relationships with its supplying vendors andgood access to their expert technicians.

    All of this resource is included in the price when applications are delivered from an ASP. Inmost cases, they are delivered to pre-set quality of service standards laid down in a servicelevel agreement. The only management overhead for the customer is in monitoring that

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    service quality to make sure that it measures up to the pre-agreed standards. No other in-house resource is required to operate the solution once it is up and running, and mostapplication services have rapid or even instant implementation cycles.

    Budget friendly

    Application services introduce the phenomenon of predictable costs into enterprisecomputing. With in-house solutions, budgeting has tended to be more of an art than ascience. Although the cost of acquisition is fairly predictable, the cost of operating andmanaging an application is notoriously difficult to estimate in advance of building up someexperience of operating the system. In the ASP model, the cost is fixed in advance,according to the number of users and the features being used. If either of thosesubsequently vary, the resulting change in the cost is also known in advance.

    Since the payment covers both the application itself and its operation, there are no hiddenextras for unforeseen glitches or breakdowns - that too is covered by the price and theservice level agreement. Equally, the cost remains the same even if the user's environmentis undergoing rapid change. It does not matter if the user is relocated to a different networkor building, or installs new software on the client machine - in every case, the applicationwill continue to be available from the provider's remote data centre in exactly the same wayas before.

    Implementation too is less costly than is the case with conventional methods of acquiringcomputing. Since there is no upfront payment to acquire the software or the server, it costsless to get started. There are fewer technical issues to overcome, since by definition, anonline application is network ready. It can therefore be accessed without modification in anystandard network environment. The only implementation work that may be necessary is toprovide integration between the new app and existing apps that are run in-house, or toconfigure the application to the specific business processes of the customer organisation.

    These implementation and other cost of acquisition factors combine to make new orspecialist applications more affordable and easier to implement using ASPs compared totraditional methods.

    A flexible friend

    Although high-end applications are typically supplied by ASPs on three-year contracts,online applications of the type available from AppsOnline.com give enterprises the freedomto use them on an as-needed basis. This feature can be deployed to great effect whenmoving into a new business area or taking advantage of a new application capability, sincethe move can be tested without committing a large investment in a resource that may onlybe used for a short time.

    In the case of more sophisticated applications, there is still scope to simply 'switch on' or'switch off' new users or new functionality almost instantly. Similarly, upgrade revisions andinterim releases of the software can generally be implemented without disruption to theservice that users experience. A further boon is a trend among software vendors to use theASP model to demonstrate and configure applications prior to implementation, givingenterprises much more of an insight into the suitability and scope of the software.

    As ASP aggregators like Interliant become more adept at managing integrated portfolios ofapplications, the ability to introduce or trial additional applications will become a routinebenefit of the model.

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    Network ready

    Internet-based applications come into their own when the function is one that is to beaccessed by users spread across several locations or organisations. Deploying andmaintaining applications on multiple sites is complex and costly using traditionally installedsoftware. But if the applications are hosted on Internet-based servers, they are immediatelyaccessible from any web browser. The browser does not have to be on a PC or a networkterminal. It could be on a handheld computer, or even a mobile phone or other wirelessappliance. Distance becomes no object, since the Internet is designed to allow access toany server irrespective of physical location. Likewise there are no incompatibility issueswhen sharing an application across separate organisations, even if each party usescompletely different and incompatible local network systems, application suites and clientenvironments.

    Enterprises can exploit these benefits by setting up and running Internet-based applicationsthemselves. But delivering applications across a wide area network is a complex skill, andin the Internet environment, the additional overhead of maintaining 7x24 operation is theaccepted norm. Turning to an ASP is the final step in taking advantage of the network-based architecture of the web server model. Having the application managed by an ASP issimply a matter of changing the hosting location from an in-house data centre to anexternal provider's, in the process moving it closer to the appropriate skills and resources.

    ASP-READY BUSINESS ENVIRONMENTSThe characteristics of adaptability, flexibility and network readiness associated withapplication services makes them highly suited to certain types of business environments.The market experience of Interliant and other providers have demonstrated that ASPdelivery offers concrete benefits to customers where any of the following are present insignificant numbers.

    High growthNo type of business is more in need of the ability to quickly access computing resourcesthan a business that is growing fast, particularly small businesses and those inindustries with a high proportion of startups, such as technology and Internet. There islittle time available to find staff, evaluate alternatives and gain expertise. Growingbusinesses just want to access a resource that will get the job done so they can forgeahead to the next milestone.

    Mobile workforcesBetter communications and advances in portable computing have increased the use ofautomated solutions in field sales and customer service. But in order to operate suchsolutions, an organisation must become an expert in the provision of applications to adial-in user base across the wide area network or Internet. Many customers have foundit makes sense to use an outside provider to deploy and operate applications such assales force automation and customer relationship management, using infrastructureand expertise that is dedicated to implementing and operating such applications.

    Changing headcountsWhen the IT organisation needs to react fast to rapid changes in the user base of anorganisation, being able to call in the services of an ASP provides valuable extraresources. Corporate reorganisation, mergers and acquisitions and expansion into newgeographies or business areas all place extreme demands on an IT infrastructure, at atime when IT staff are under pressure to adapt existing systems to the new corporatelandscape. Using an ASP to deploy applications relieves the pressure on internal ITstaff and retains a level of adaptability to further change that purchased solutions lack.

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    Highly distributed branch networksRolling out applications to an extensive branch network is a complex, costly exerciseusing traditional client-server computing. Many organisations are seeking to ease thisoverhead by moving to server-based architectures in which branch staff accessapplications using a web browser interface or other thin client. The organisation'scentral data centre thus becomes a remote service provider to the outlying branches,but without the expertise in handling wide area network communications that aspecialist provider possesses. Having made this move, it is a short, simple and logicalstep to use a third-party provider to fulfil that role, taking advantage of the provider'sgreater expertise and economies of scale.

    ExtranetsUnlike purely internal deployments, extranets require significant security preparationsthat further increase their cost and difficulty. An ASP will have built the sophisticatedfirewall and network technologies needed to securely connect with partners andcustomers, making deployment that much easier.

    Virtual teamsToday's business environment is giving rise to a proliferation of ad hoc teams and'virtual corporations', where participants are scattered either geographically or acrossmultiple organisations, with members often joining for short periods to contributespecific components and then leaving again. ASP delivery of Internet-based sharedapplications overcomes these hurdles and allows such teams to work togetherseamlessly and cost-effectively.

    ASP APPLICATIONS FOR THE ENTERPRISEThe range of applications available to enterprises from ASPs grows by the day, as moreand more vendors and providers enter the market. The principal application types on offerfall into the following categories.

    E-commerce

    Businesses ranging in size from sole proprietor operations up to very large corporationslook to providers to host and operate their e-commerce applications. Many ASPs includevendors such as Microsoft, Broadvision and Vignette on their list of application services.Interliant likewise, with a strong background in web hosting, offers e-commerce hostingbased on Microsoft and IBM platforms. But while some of these software vendors arebeginning to introduce rental-style licensing into their relationships with providers andcustomers, to describe e-commerce hosting as an application service is to stretch thedefinition into the sphere of outsourcing. By their nature, e-commerce sites are heavilycustomised to the individual needs of the client, rather than being a packaged service thatis delivered to multiple customers.

    A much better example of an application service - and one that is spreading with greatspeed - is electronic purchasing. This business-to-business e-commerce applicationrequires standardised links between buyers and sellers and thus lends itself to a third-partyprovider model. Vendors such as CommerceOne and Ariba who have been early entrantsinto this market initially began selling their solutions to large enterprises in a traditionalmanner. But they have quickly found that this slows the rate of adoption and raises abarrier because of the upfront investment required. Since one of the keys to the success oftheir business model is achieving critical mass, they are turning to the ASP model to gainrapid market penetration.

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    Interliant has chosen to team with Clarus to offer the software vendor's eProcurementapplication. Clarus made the bold move last month of selling off its ERP product suite toanother vendor in order to focus its own resources on the ASP model. Customerspreviously paid upwards of $1m per implementation for its electronic procurementapplication. Now it has embraced what it calls a "zero capital" model of teaming with serviceproviders and offering the application on a per-user, per-month basis.

    The dual combination of electronic purchasing with the ASP model has a dramaticconsequence for enterprises. E-purchasing is acknowledged as a means of reducingadministrative costs from up to $150 per purchase order raised by the typical organisationdown to just a few dollars, or even less. That was the rationale for large enterprises tomake multi-million dollar investments in the technology. Using the pay-as-you-go ASPmodel, that upfront cost disappears, with the result that enterprises can begin to earn areturn on investment (ROI) from day one. Indeed, since ASPs, like any other business,invoice at the end of each month, their customers may even find themselves enjoyingreturns before investment (RBI).

    Clarus is teaming with a number of ASPs, and this opens up the theoretical potential for acustomer, having implemented with one provider, to subsequently move their Clarus setupto an alternative. It will be up to Interliant and its Clarus-hosting competitors to securecustomer loyalty through providing a competitive service and perhaps also offeringcomplementary applications or vertically tailored packaged offerings and services.

    Customer relationship management (CRM)

    The gamut of customer relationship management applications, from sales force automationthrough to customer service call centres, has been seen as a prime candidate for deliveryvia ASPs. There are two principal reasons for this. The first is that front office staff are farmore likely to be road warriors or distributed across branch offices than are back officestaff. Thus as user groups they fall into one of the categories most suited to ASP delivery.The second is that CRM is a relatively new class of application and thus potential clientsare more likely to be lacking the necessary in-house application skills. Alternatively a CIOmay not have sufficient technical resources to allocate to supporting a brand newapplication, even if the sales director has already had the board's approval to go aheadwith implementation.

    Lotus Notes/Domino has been a popular platform for sales automation applicationsbecause of its suitability for use with distributed workforces, and therefore Interliant has hadsome experience with hosting this type of application, including Prevail Professional fromSynergistics, which it continues to offer. However, while this will fill an entry-level role, itrequires installation of a Notes client and thus is best suited to existing Notes users. Tooffer a complete range, Interliant must fill out its CRM portfolio.

    While the company has not yet introduced new CRM offerings, it has already forgedrelationships with two leading CRM application vendors, and firm announcements ofapplication services based on their software are unlikely to be long in coming.

    The first ISV partner is Onyx Software, a leading sales automation and CRM vendor on theWindows NT platform that already has an established ASP channel. This month, Interliantbolstered its Onyx skills base with the acquisition of London-based systems integratorSales Technology, a specialist in CRM solutions based on the vendor's products. It isbecoming increasingly common for ASPs to acquire skills in a particular application byacquiring a leading integrator for the package. In some cases the ASP uses the acquisitionto strengthen its own direct sales of the package. In other cases, the skills acquired areemployed in developing and supporting the service for supply via channel partners of theISV. Interliant must be careful to make a clear choice between the two paths to avoidchannel conflict developing.

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    Its second partner is Pivotal, a vendor that is actively positioning its web-based customerrelationship suite for the ASP model. As a package that, like the Clarus product, has beendeveloped from the ground up for web-based operation, it is in a class uniquely suited forASP delivery.

    It will be important for Interliant to offer integration of CRM solutions with other applicationsand online services. One of the attractions for enterprises of turning to an applicationservice provider for CRM - particularly one with a strong e-commerce background - is tohave the ASP take care of integration between the two applications. Analysts havestressed the importance for any business of linking together e-commerce and CRM. This isan example of where ASPs can offer real value through combinations of applications.

    In due course, the value of broader aggregation of applications and services is likely tosurface earliest in this application area. For instance, an ASP who provided CRMapplications would enhance its offering if it were also able to offer virtual call centreservices as an optional extra. Probably requiring an alliance with a separate call centreprovider, this is a useful example of the potential for enhanced service offerings throughaggregating third-party services around a core set of applications.

    Enterprise resource planning (ERP) and accounting

    Most of the attention focussed on the ASP industry to date has been concentrated onproviders who offer ERP and accounting applications from vendors such as SAP, Oracle,JD Edwards and Peoplesoft at the top tier and such as Great Plains, Lawson Software andothers in the midmarket.

    The attraction is perceived to be the greater affordability of these applications whendelivered using the ASP model, since the usual upfront investment in purchasing thesoftware licence and implementation can be amortised over the life of the contract. Forfast-growing companies and startups, there has been the additional attraction of movingdirectly to a top-tier application rather than having to pass through an interim stage as thebusiness grows, with all the disruption implicit in changing from one application suite toanother.

    However it has been notable that ASPs offering this type of application have found it hardgoing to sign up customers, except among high-growth technology companies. Mostenterprises do not have sufficient confidence in the ASP model to entrust their corebusiness systems to one of these new providers. It is only where the benefits becomeoverwhelming - for instance in high-growth or highly distributed enterprises - that thebalance tips decisively in favour of ASP delivery.

    Interliant's decision to hold off from introducing this class of application straightaway is thusa sensible reading of the market. Enterprises will migrate their ERP and accounting to theASP model once they have already committed to ASPs and found them reliable inproviding other, less established classes of application.

    Messaging and collaboration

    It is hardly surprising that messaging should have been one of the first applications to behosted, since its purpose is to shrink distances and thus inevitably it has been deployedamong distributed groups of users that are natural candidates for ASP delivery. In thelargest organisations, it is also highly infrastructure intensive and vitally mission critical. Ifan email server goes down, messages get lost. Few enterprises have the data centreresources available to keep servers running every minute of the day on a 24x7 basis.

    Early hosting of messaging has been a proving ground for application sharing. One of thechallenges of the ASP model often overlooked by outsiders is the fact that mainstream

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    client-server applications are designed to be owned, not shared. That is why Notes hostinghas remained a minority activity until recently. Most providers have only been able to offer iton dedicated servers, unable to realise the economies of scale that are available when asingle server system can be shared by multiple customers.

    It took considerable effort and development work on the part of Interliant to make Notesfully shareable in those early days when it first began Notes hosting. While the currentversion of the product includes features that make it easier to support operation in a shareddata centre, its architecture still assumes single-enterprise deployment, and it remainscomplex to set up as a shared system. Its rival Microsoft Exchange is even less suitable forsharing and requires highly specialised customisation to allow sharing. However Microsofthas committed to re-architect Exchange for shared operation in its next release.

    This year, Interliant has added a new variation on its Domino hosting service, calledeReach. In this delivery model, the ASP still provides the application as a hosted service,priced on a per-user per-month basis, but the servers are actually located on customersites. Despite aspirations to universal, pervasive connectivity, in the real world high-qualitytelecommunications lines are not always available, and even where they are, theysometimes go down. Replication to a local server is often a more cost-effective means ofproviding for continued productivity than adding sufficient connectivity to guarantee thecommunications link. The ability to support satellite servers - and indeed desktops - is likelyto become a necessary part of an enterprise ASP's offering.

    Messaging and collaboration are obvious complementary applications to e-commerce andCRM, and the ability to offer integrated solutions will be another benefit of ASP aggregatorssuch as Interliant. Indeed, one of the evaluation criteria that potential customers of ASPsshould take into account ought to be the range of applications available. To this end,Interliant must add Exchange hosting to its messaging portfolio as early as possible. Giventhat its new acquisition Sales Technology has Exchange as a second area of competence,it may be deduced that this is not far away.

    Distance learning

    The extent to which education and training is already delivered as an application service isoften overlooked. It is an interesting example in that a hosting provider like Interliant willtypically provide its service to an education or training organisation, which will use it todeliver content to trainees or students. Thus the hosted organisation is the provider of themain service, with the underlying computing simply a delivery mechanism. HoweverInterliant also has a direct relationship with the course recipients since part of its service isto register users and collect course subscriptions. The example illustrates that end userswill interact with ASPs in different ways, sometimes directly, sometimes as an infrastructureprovider or subscription management agent.

    Instant applications

    A growing number of entry-level and point solutions are available in the form of onlinerentable applications. They are as useful to meet specific needs in large enterprises as theyare to fulfil core requirements in smaller organisations.

    Provided ready to configure and use online, and accessed through a browser without anylocal install, the most prevalent examples include:

    Website and e-commerce store designers File sharing and document management Project management Business administration Electronic marketing

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    Email managers Teleconferencing Unified messaging Specialist point solutions

    It is important for an ASP aggregator such as Interliant to ensure where relevant that thesolutions offered at this level can be integrated with, or allow migration to, the moresophisticated applications also offered by the provider.

    Vertical market applications

    Certain vertical market sectors, particularly healthcare, construction, professional servicesand high-tech manufacturing, are proving avid early adopters of the ASP model. Tappinginto a shared skills and systems base allows participants to amortise the additional costs ofcatering to their special needs across every member of the group. Interliant is targeting itsAppsOnline.com particularly at vertical market groups, but it may need to move rapidly tostay ahead of other providers more attuned to the specific needs of each individual market.

    EVALUATING THE PROVIDERTurning to an application service provider puts an enterprise in a position of completedependence on a third party. This is not unusual in business - enterprises depend ontelephone companies for their telephone service, and they depend on banks to processfinancial transactions for them. But before entering into a service relationship with a phonecompany or a bank, a certain amount of research is prudent to ensure the provider iscapable of delivering the required services to a competent and consistent level. The samedisciplines apply with even more stringency to ASPs, since it is an industry where bestpractice has not yet been established and generally accepted. There are a number of areaswhere a potential client must satisfy themselves of the provider's capabilities.

    Fitness for purpose

    The first step is to assure that the application has been properly prepared for ASPdeployment. The provider should be able to show some experience and expertise inoperating application services, and the service itself should be professionally presented asan ASP proposition.

    It is important to establish the financial stability of the provider. It will inevitably have madesubstantial upfront investments in data centre facilities, staff and equipment in order to bein a position to offer ASP solutions to multiple customers. That financial stability mustremain secure for the lifetime of the contract in order to assure continued service.

    The provider should demonstrate an understanding of the product and its use in ASPdeployments. It is also important to determine that the provider has a secure relationshipwith the application vendor that will be sustained throughout the intended contract period.

    Subscriber management infrastructure

    Service Level Agreements (SLAs) are a vital component of any application servicesrelationship. They determine what the client can expect in return for the subscription orrental payment, and provide a basis for resolving any disputes or interruptions to service. Itis up to the client to verify that the quality of service guaranteed by the SLA measures up tothe needs of users. The provider must take responsibility for monitoring its performanceagainst the SLA, and it must make sure sufficient resources are available to correct anyproblems before they threaten to breach the SLA limits.

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    If a provider does not demonstrate a professionally-prepared SLA and an infrastructure thatis able to support it, then the client should find an alternative supplier.

    Delivering on the promised flexibility and responsiveness of the ASP model places specialdemands on a provider's administrative resources. Providers must demonstrate a robust,preferably automated, system for tracking subscriber accounts, with an auditable record ofeach change and reconfiguration. This should link into an efficient billing system thatprovides customers a clear and detailed invoice every month.

    Where the relationship with the provider will be a long-term one, then it is important to givesome thought to upgrade paths and scalability, particularly in the case of entry-level rentalsolutions. Many rental applications in the market today have been created to reach avolume market, but with no thought given to any upgrade path once their limits have beenreached. Likewise, some providers are not set up to host applications beyond a certain sizeor reach. Some assessment of the provider and the application's ability to scale to thefurthest potential extent of the requirement is always advisable, in order to weigh up the riskof reaching the limits at a critical point. This is particularly prudent in the case of e-commerce trials, where success can lead to sudden rapid expansion. Being forced to moveto a new platform in the midst of such success could fatally undermine this type of project.

    Technology infrastructure

    Since one of the reasons for going to an outside provider is in order to achieve higherstandards than are possible using in-house resources, customers expect high standardsfrom third-party providers. The provider's technology infrastructure underpins the reliabilityand performance of any ASP solution, and should be expected to surpass the customer'sown in-house setup. If a provider's facilities do not impress, it is a sure sign that the deliverywill also be a disappointment.

    PerformanceThe data centre should incorporate technology to maximise performance, with load-balancing across servers, high-bandwidth links to external networks and high-specification server platforms. There should be dual redundancy in servers, networkconnections, power supplies and at other points to ensure that, in case of a failure ofone component, service can be continued.

    Data safeguardingThe provider should be able to show state-of-the-art data protection capabilities, withRaid storage or similar, frequent backup, a disaster recovery plan and high standardsof physical security. There should also be a clear procedure for the client to recoverdata from the provider at the termination of the relationship or contract.

    SecurityVarious measures are necessary to protect client data. The data centre should havesophisticated firewall protection against unauthorised access to servers. There must beclear procedures for authenticating user access to the applications. The provider shouldalso operate stringent in-house security procedures to protect against infringements byemployees or physical intruders.

    Systems managementA sophisticated infrastructure is required to oversee the operation of the data centreand ensure that service is maintained within SLA parameters at all times. The systemmust be managed at the network, data centre and applications level, with the objectiveof ensuring users always receive a satisfactory experience when working in theapplication.

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    Support infrastructure

    It is when something goes wrong that a service provider's operation is really put to the test.Even in the case of a single rental application that progresses without any technical hitchesfor six months, if there is then an invoice error that goes unresolved or the application goesdown for several hours without any explanation, it poisons the entire experience.

    It is essential to verify that any provider has proper procedures for dealing with supportproblems, including those originating from subcontractors or which might require technicalsupport from the application vendor. Users are also entitled to expect predeterminedresponse times to be set and met.

    Provision of an effective level of service depends on the tight integration of in-house andpartner resources, across sales, implementation, operations, application development,customer service and technical support.

    ASP DELIVERY CHANNELSDuring the first year or so that the ASP industry has been in existence, provision hasgenerally been direct to users. This summer has seen the first emergence of a channelmodel, in which ASPs form partnerships with ISVs, resellers and systems integrators toachieve more extensive market penetration. Increasingly therefore, an enterprise may findthat its access to application services is through resellers rather than direct from the ASP.

    Enterprise applications which require significant implementation work have traditionallybeen delivered under the application purchase model by systems integrators. While thereare some exceptions, it is becoming evident that the larger ASPs are generally falling inwith this channel structure, and forming channel partnerships with solution providers whowill take care of consulting and implementation of the application. Once implemented, thecustomer relationship is directly with the ASP, but the channel partner remains available tohelp with implementation support issues and modifications.

    Mid-market applications that have in the past been delivered through a reseller channel areadopting a similar model, in which the reseller acts as the sales and implementation agent,and then continues to provide local support after service provision begins. A variation onthis scenario is where an ASP hosts an application for an ISV, and provides the applicationservice to the ISV's customers on its behalf.

    What this means for customers is that in many instances they can continue to deal withresellers and integrators they have always dealt with for their computing needs, but cannow look to those providers to act as agents for the supply of application services as wellas installed solutions. They must make sure to establish that a strong, contractualrelationship exists between the agent and the service provider, sufficient to assurecontinued service throughout the term of the contract.

    As ASP provision becomes more prevalent, resellers and integrators may find a new roleas ASP aggregators. It is unlikely that one provider will ever be able to satisfy all of thecomputing needs of a typical mid-sized business, unless it specialises in a specific industrysector. Thus IT solution providers will have a new role to play in helping clients to integratetogether different application suites delivered from different service providers.

    As Interliant begins to form relationships with systems integrators and ISVs to becomedelivery partners for its services, it should aim to set best practice standards in theendeavour. It already has significant experience of dealing with smaller ISVs in deliveringhosted applications, but there is much that still has to be refined before the ASP industrywill be able to point to robust, proven channel models.

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    APPLICATION SERVICES STRATEGIESThe maturing of the necessary technologies and the emergence of ASPs have given newcredibility to application services as both a tactical and a strategic option in enterprisecomputing today.

    Their arrival coincides with a business environment that is ripe for this type of on-demandcomputing provision. Business conditions change at an alarming pace, there areoverwhelming competitive pressures to adopt new technologies and applications, andworkforces are increasingly dispersed or mobile.

    Application service providers bring an orderly, reliable solution to these multiple challenges.Especially suited for new-world networked applications including electronic purchasing,customer relationship management and long-distance collaboration, they provide a skilled,cost-effective source of solutions that lend themselves to rapid deployment without massiveupfront investment.

    Enterprises who wish to reap the benefits would be well advised to start acclimatisingthemselves to the ASP environment today. Responsible early-adopting providers likeInterliant are helping to establish rigorous best practice standards for this young industryand demonstrating the benefits in proven customer implementations.

    Now the next phase of development of the industry is under way, giving customers theability to source multiple solutions from a single provider. Customers stand to gain evenmore cost efficiencies from ASPs who can provide a ready-made infrastructure forintegrating multiple applications and services. With its extensive practical experience ofoffering and managing application services, Interliant is well placed to blaze a trail in theevolution of the ASP aggregator model. In doing so, it will be pioneering new economies ofscale in the provision of computing to tomorrow's enterprises.