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A Winning Combination: Software-as-Services Plus Business Consulting and Process Services
By Laurie McCabe
January 30, 2004

This month’s surprise acquisition of ManagedOps by Surebridge continues the consolidation trend among ASPs and opens up a vacancy in the ASPnews Top 20 Providers list. Meanwhile, consolidation among MSPs brings a familiar name back into the list of Top 30 Enablers.

ASPnews Top 50 Archive
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This is Surebridge’s second acquisition in recent months, maintaining the company’s quiet but increasingly sure-footed expansion. Surebridge was founded by Harvard Business School alumni Pradeep and Stephanie Khurana with a mission to realize the benefits of the ASP model for small and mid-sized businesses. In the past year, CEO Peter Boni has orchestrated a five-part strategy that has brought the company to profitability.

Crowning a New Top ASP
While the number of ASPs that outsource other vendors’ applications continues to shrink, those who operate services based on their own software continue to prosper. Many of the best known Web-native ASPs offer salesforce automation or some other aspect of customer relationship management (CRM), but a second category that has seen several success stories is Web site content management. The ASPnews Top 20 already includes Atomz, one of the best-known names in this category. The vacancy left by ManagedOps allows us to add another notable proponent.

Crownpeak Technologies, based in Los Angeles, has built a strong customer list for its hosted Web site content management service, and regularly records customer wins against more expensive, traditionally licensed alternatives. Crownpeak is especially notable for its multiple partnerships with other hosted providers. It has worked with its partners to create APIs between its software and theirs, so that functions such as search, user authentication, e-commerce transactions, e-mail list management and banner ad management are readily available to customers, often from a choice of providers.

The concept of working with multiple providers to mix and match components that suit a broad range of customer needs is one that is often talked about in the context of Web services and hosted applications. Crownpeak deserves special commendation for actually putting it into practice.

Welcome Back, NaviSite
Our Top 30 Enablers list this month welcomes back NaviSite, the managed hosting provider originally founded by Internet incubator CMGI. NaviSite previously left the Enablers list while it underwent extensive financial and operational restructuring. It has now emerged from that process and recently began to bolster its revenues with acquisitions of other managed hosting businesses, most notably Avasta. The recent appointment as CEO of Arthur Becker, who was instrumental in engineering the recent acquisitions, signals the company’s determination to build on this strategy as a platform for growth.

NaviSite’s renewed expansion through acquisition has allowed it to leapfrog another MSP, Sitelite, which it replaces in the Enablers list. Although it has not yet reached the all-important benchmark of turning cash-flow positive, NaviSite is once more a company worth watching.


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