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To: Michael Olin who wrote (12852)	12/16/1999 10:26:00 AM
From: Bob Sutton	Respond to of 19080

Michael, don't you find it shocking that ...the analysts on the panel could not identify a "name brand" company that has embraced the ISP model? Merrill Lynch just inked a $60+ million deal with EXDS to host it's online brokerage service; countless banks are running their e-banking services in ASPs, etc. I think you're smack-on target when you say "Once you are comfortable with an outside vendor providing these services on-site, you begin to covet the real estate they occupy. If you have them move their operations back to their own buildings, you can call them an ASP." But I'll submit that the energy behind this development is NOT that businesses want to "rent" ERP or other mission-critical apps so much as they've discovered after long experience that actively managing the hundreds or even thousands of Unix and NT servers these apps require is VERY unlike managing mainframe data center operations. Scaling, capacity management, service-level maintenance -- all these things are harder to control and IT executives have learned that they get few kudos for doing it right and all the blame when something goes wrong. They look out and see rack after rack of little boxes that use up real estate and mystify prudent management practices. The ASPs are ultimately just another evolution up from co-location services and ISPs. By the time an IT manager realizes that he can transfer the operational headaches of running the server farm to an outsourced provider, it's not such a big deal that the software license model evolved too. Bob Sutton

To: Michael Olin who wrote (12852)	12/16/1999 10:30:00 AM
From: Richard Habib	Read Replies (2) \| Respond to of 19080

Michael, while one could project that ASP will represent the future, it remains difficult to see how one gets there from here. As practiced now ASP offers a plain vanilla version of applications. Most large companies have heavily customized versions. As I understand it, presently no ASP offers heavy customization. If they did it would go a long way toward eliminating the efficiency inherent in the ASP concept. Second, is security. It remains doubtful in the foreseeable future, that large companies are going to hand their crown jewels, the info present in their ERP, to a third party. I have a close acquaintance presently in the process of shopping an ASP venture to some of the better known incubators. While ASP remains a hot concept for IPOs and stock appreciation, much of the buzz in those circles is that it is a limited concept. Rich