RE: More Super ASP StuffThe New Economy:
Is An ASP Right For You?
Startups are prime candidates for ASPs because providers
can furnish ready-made applications to help the company
launch faster
By Craig Brown
A number of companies have flocked to application service
providers, and many articles have been written on the
pros and cons of ASPs. As with many fledgling industries, no
one is really sure how things will shake out with ASPs, but
providers are staking their claims with a range of businesses.
If your company is considering an ASP, here are a few things
you should know.
ASPs offer everything from office essentials, such as word processors and
spreadsheets, to multimillion-dollar financial and management applications.
These applications are hosted on large servers at the ASP's data center and are
accessed using a wide area network, usually through a dedicated connection or
virtual private network.
Large applications are good candidates for the ASP model; they tend to be
cumbersome and require lots of resources to set up and operate. An ASP can
thus be a good facilitator for these types of programs. The jury is still out on the
viability of running smaller, cheaper applications on a true ASP model over a
WAN link. It seems much more logical to run such applications from a local
LAN-based server that would provide faster access. It may be possible for an
ASP to set up such servers for a company and provide monitoring and
service-level agreements for LAN-based applications, but that hasn't happened
yet.
Startups are prime candidates for ASPs because providers can furnish
ready-made applications to help the company launch that much faster. Most
ASPs offer only a small selection of applications, but I believe you will see them
broaden their choices to include a set of applications that will essentially form a
business framework. A startup can select a particular framework and have most
of its internal practices up and running in a matter of days, allowing it to
concentrate on growing the business instead of maintaining applications.
Last month's high-profile denial-of-service attacks on some of our leading Internet
companies bring new concerns about the vulnerability of ASPs to the same kind
of attack. ASPs offer different methods of connecting to their service. Most often,
it involves using a VPN over an existing Internet connection. If a potential
perpetrator is looking for sites to attack and comes across the Internet
addresses used by you or the ASP, it becomes an easy matter to jam your
connection with bogus traffic.
Depending on the application your company is using, a denial-of-service attack
on your ASP connection could be little more than an inconvenience-or it could be
more severe than having your Web site taken out. If you're using a financial
application on an ASP that's processing real-time transactions from your Web
site, you'll end up losing not only those transactions, but the confidence of your
customers as well.
If you encounter interruptions with your ASP service, you'll end up dragging out a
copy of your provider's service-level agreement. That agreement outlines the
terms of service the ASP will provide and usually contains the remedies you'll be
entitled to if there is a loss of service, beyond downtime caused by scheduled
maintenance.
The problem with most SLAs is that they are basically the same agreements
used by regular Internet service providers-namely, you will receive a monetary
discount based on the amount of downtime. This discount will probably be a
pittance compared with the amount of lost revenue and lost confidence you have
incurred. Look for service level agreements to be a big differentiator among
ASPs, especially the newcomers. ASPs willing to put their necks on the line for
customers are the ones that will get the business.
There is certainly a good-and expanding-market for ASPs, and there are a lot of
providers that want to be your ASP. In the end, using an ASP has to be the right
decision for your company-and the better informed you are, the better the
decision you can make. ASPs are here to stay, and many companies will be
using them for critical parts of their business. Will your company be one?