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Industry Basics: Business Service and Application Providers
By Phil Wainewright

April 27, 2001

Creators of business services and applications provide the software and services from which solutions are assembled in the ASP value chain. Many act as their own ASPs, providing their services direct to users, while others reach their target markets by partnering with third-party ASPs and service integrators.

Business Service Providers (BSPs)
There are growing numbers of BSPs, ranging from startups to long-established business service companies. The one thing they have in common is that they use the Internet to deliver services to their business customers. The huge variety of services available ranges from professional services such as accounting and payroll processing, to more mundane but equally essential business services such as printing and event management. Indeed, in principle, any enterprise that automates the ordering and fulfillment of its services and puts them online becomes a business service provider (BSP). With the Internet rapidly becoming an integral part of the business infrastructure, all companies that offer professional or business services are ultimately destined to become BSPs.

Software Providers
Software developers and publishers create the software components and applications that are used to automate business services.

  • Independent software vendors (ISVs) create and publish applications as a finished package, designed to perform a specific range of business functions. Packaged applications have traditionally been sold to and installed by end user enterprises, and ASPs have had to adapt them, where feasible, for delivery in a service model. Today, an increasing number of ISVs are themselves adapting or creating packages to be suitable for implementation as an Internet-based service by ASPs, BSPs and other providers.
  • E-business platform vendors create packaged application engines that automate a set of core functions to form the basis of an online business service. Specifically created for the purpose of delivering online services to multiple business customers, these platforms are designed so that providers can host them on shared servers and tailor the functionality to meet the needs of specific markets.
  • Software developers are companies or individuals who provide custom development of software components and applications, specialising either in particular niche industries and interests, or in specific areas of software expertise. A growing number of developers are working through collaborative online development portals, where they can team up with other developers, bid for projects, or sell and exchange ready-made components and code.
Web Service Providers
A new generation of providers delivers services and application components that conform to emerging Web services standards. These standards make it easy to link multiple services together to create highly adaptable business solutions. Web services range from complete applications and service offerings to individual component services that are designed to support or enhance other services. They include online content such as news, training, advice and entertainment, as well as collaboration, transaction and communication services. Some Web service providers are aggregators who specialise in bringing together multiple online services from third-party providers.

Phil Wainewright founded in 1998 and is the publisher of Loosely Coupled. He can be contacted at

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