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Microcap & Penny Stocks : FutureLink Distribution Corp. (NASD-OTCBB: "FLNK") -- Ignore unavailable to you. Want to Upgrade?

To: Al's Fun who wrote (830)	12/26/1999 6:36:00 PM
From: Brian1970	Read Replies (1) \| Respond to of 841

From redherring.com: about ASPs as a trend in 2000... Doesn't mention flnk directly, but still exciting. Enterprise software becomes a service By Luc Hatlestad Red Herring magazine From the December 1999 issue For some time now, we have been touting the idea of Web services. The thinking is that many software applications once sold in shrink-wrapped packages will eventually be better managed by a third party and distributed as services across the Internet. (See our November 1998 briefing.) Web services as we initially defined them are primarily suited for the consumer market. But a strong business-to-business cousin is emerging in application service providers (ASPs). Although the idea remains the same -- applications and data maintained on an offsite server and accessed through clients' browsers -- the ASP market will be considerably bigger than the retail Web services market, with the boom in full swing in 2000. Of course, unlike many giveaway consumer Web services, including Web-based email and calendar applications, business-to-business services will be far from free. The IT research firm IDC projects that the worldwide ASP market will reach $2 billion by 2003; the IT consultancy Forrester Research (Nasdaq: FORR) pegs it much higher, at $10.1 billion by 2001. This rather drastic discrepancy is due to definitions: Forrester's estimate includes the market for any outside help -- independent contractors that aren't technically ASPs, for example -- that companies might enlist to manage their applications. Regardless, the market is large and companies are already exploring it in earnest. The reasons are straightforward. As enterprise software becomes an increasingly sophisticated, multilayered aggregation of interconnected applications, managing them is fast becoming too cumbersome and expensive for most in-house IT departments. Having them delivered as services over the Internet means fewer demands on a customer's IT department -- and, in the long run, probably lower costs. Rather than drop huge lump sums for elaborate software packages that may go partially unused, companies can pay as they go,shelling out only for the services they truly need. This model works for the ASPs as well, because instead of relying on big purchases of software suites from companies that may cancel at the last minute, an ASP can generate a more consistent revenue stream by doling out and increasing its services as required. And, the ASPs hope, as companies see how well the services run, they'll buy more of them. All the major enterprise software vendors are committed to the ASP trend in one way or another, in no small part because they've almost saturated the market of the very large organizations that can afford their software and are now turning their attention to smaller companies. SAP America, for example, announced in August that a startup called eOnline would manage and host its enterprise software for third parties. It hopes to target companies that want SAP's widely used technology but can't afford to pay for all of it and pay SAP's costly army of consultants to install and manage it. The company made similar deals earlier last year with Qwest Communications (Nasdaq: QWST) and the IT consulting firm EDS (NYSE:EDS), both of which are managing SAP's software for midmarket customers. SAP isn't the only one. In an example of how the ASP space can create markets within markets, Oracle (Nasdaq: ORCL) has developed a new strategy for selling to the sellers. Called iHost, the venture bundles Oracle's database and other tools and sells them to companies that want to get into the ASP business. In addition, the database giant has established a service called Oracle Business OnLine that for a monthly fee will provide and host applications for processes like accounting, manufacturing, and procurement. TIER DROPS The ASP boom will also have a profound effect on companies that are a tier or two down from massive corporations like SAP and Oracle. Companies including Applicast, Corio, USinternetworking, Nexus, and Niku (see "Farzad and Away") can apply varying degrees of outsourcing experience to this sector. The ASP market will also establish niches as specialty hosting companies emerge to serve vertical industries like law, advertising, and -- as in the case of JeTech Data Systems -- labor-resource planning. Last August JeTech, which has developed project and labor management software since the early '80s, announced that it would join the ASP race with eLabor.com, an Internet- and telephone-enabled labor management system. It's just this sort of highly specialized subsector that ASPs will serve as more and more midsize companies get comfortable with moving their business processes online. As these ASPs grow, there is the potential for them to become specialized channels or portals in their own right. But the key word here is comfortable. There is still acontingent of industry observers who are skeptical that companies will entrust their financial and other sensitive data to outsiders. Even though corporate protectiveness may slow ASP adoption rates, however, the trend is still inevitable. The Internet has proven itself reliable and secure enough to carry just about any kind of traffic, and the promise of a service that removes so much of the hassle and expense from application and data management will be enough to overcome the reluctance of most companies.