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To: arthur pritchard who wrote (154316)	2/25/2000 9:33:00 AM
From: rudedog	Respond to of 176387

arthur - re: Theoretically, there are many many asp's. The reality is, that many potential applications, need so much tailoring, that the concept dissolves, when the thing gets to the point of actually being implemented. I am reminded of the internet joke going around: A boy asks his father "what's the difference between theory and reality?" His father asks the boy to ask his mother if she would sleep with Robert Redford for a million dollars, and then ask his sister if she would sleep with Brad Pitt for a million dollars. The boy quickly returns with a "yes" answer in both cases. The father says "well there you have it - in theory we are sitting on 2 million, but in reality we're just living with a couple of sluts..." The ASP market is a little like that - in theory huge, the reality a little more tawdry. Your comments about IBM's attempts to do app hosting in the 60s are actually well taken - the difference is the universal access and common client metaphor of the web. Large companies currently pay substantial access fees for productivity applications like word and excel, as well as third party applications, but on a per-user basis they pay less than a smaller user. Part of the driving force behind some ASP plans is to give smaller businesses a "per-user" cost similar to what the big boys get, especially for occasionally used applications. One model of "per-use" charging actually encourages those companies to make available almost anything the user might want, since they don't pay anything unless the application is actually used. That made the big boys sit up and take notice - the larger companies typically determine what they want to run, and then license EVERYONE. Per use charges actually give a greater range of support with less cost. Many, including a number of letters to InfoWeek in the most current issue, mistakenly think that the ASP model requires access over the web, with all of the associated performance delays and potential service outages. The beauty of the ASP model is that from a client perspective, access is no different if you are using VPN tunneling from the beach in Tahiti, or LAN access from your desktop. The primary access is over a dedicated high bandwidth link (or actually redundant links in most cases) between the ASP and the corporate client network. There is little different in reliability and performance between that setup and one supported internally by the IT staff - it's still a private net, just an ExtraNet instead of an IntrtaNet, with the added benefit of seamless remote access if desired. So the initial volume buzz is based on very standard vanilla applications, made available on a different pricing basis and with better delivery options. A slightly less "vanilla" application would be the SAP ERP suites - SAP was an enthusiastic early proponent of the model and has done a lot to enable it in their own products. Technically it requires that a browser-based interface be provided in most cases, although it is relatively simple to provide the base application as well, it is just a lot less efficient. As that model proves out, there is the opportunity (or risk depending on which side of the fence you are on) that more proprietary applications will be offered in this way. That is part of the reason for the more optimistic projections on ASP growth. I tend to be more in the middle but still bullish - my sense is that something on the order of 10 to 15% of new server sales will be sold into this market by the end of the year.