www.aspnews.com/analysis/analyst_cols/article.php/709821
By Phil Wainewright March 9, 2001 Leading figures in the computing industry agree that, within the next ten years, software will no longer be delivered as a product and instead will become a service. But though this concept rolls glibly off the tongues of the likes of Bill Gates, Larry Ellison and Scott McNealy, none of them seem to spell out just how radically this is going to change the way computing works — perhaps because nobody is really sure what exactly is going to happen. Many in the software industry are therefore either blissfully unaware of the fate that is about to befall them; or else labouring under the looming shadow of what they know to be a hugely disruptive yet still largely unquantifiable threat. Fortunately, there are some emerging models and practices in the ASP sector that begin to give a clearer view of the evolutionary path for today's software applications as they morph into services. A small band of vendors have been quietly adapting their enterprise application products to meet the very different needs of Internet-centric delivery. What they have done goes much further than simply web-enabling the application. It even goes beyond implementing the software in a shared-server architecture that enables many companies to share the same system — though that is an important part of the model. What these vendors have done takes their software beyond the old three-tier model of client server, which divided applications into database, application logic and user interface layers. They have started to subdivide the application layer into discrete layers of its own, separating the core functionality of the application into a foundation platform of common business objects that interact through a transaction engine. Service providers can then add their own tailored functionality on top of the core platform, deploying and presenting its capabilities in ways that suit a specific market or customer.
Fast-growing channels Other success story examples include Documentum's content management platform and Lawson Software's enterprise business transactions engine. It's no coincidence that all three of these vendors have extensive and fast-growing ASP partner channels. Dividing the application layer into multiple tiers like this makes the software much more adaptable to the demands of the extended Internet value chain. For instance, it allows the core platform to be hosted by a company that gains economies of scale from specializing in hosting that platform, while the additional, third-party functionality can be added by the ASP or by a service integrator. This creates a win-win for both ASPs and ISVs, because it merges the economics and scalability of the one-to-many model at the platform layer with the customer appeal of industry-specific, tailored solutions at the delivery layer. Instead of competing head-to-head with each other, everyone in the value chain gets to differentiate themselves, while the application vendor reaches a wider market because partners can tailor the core application for the specific needs of the markets they're close to. Software vendors who have taken up this application engine model are well placed to move ahead into the next phase of development in the delivery of software as a service, in which applications will become increasingly modular and componentised. This fragmentation of software technology into smaller and smaller web service components will leave many ISVs marginalised. Those few who implement their core technology to suit the needs of ASPs and other web-based service providers will achieve market penetration they could never have dreamt of in the client server era. |