www.aspnews.com/news/weekly/article.php/560241
By Phil Wainewright January 15, 2001 While the ASP model has not yet managed to become the motor of the Internet economy, it is already becoming an attractive model for making economies in the motor industry. Such was the news emerging from the North American International Auto Show this week, where General Motors CIO Ralph Szygenda told journalists of plans to make the industrial giant's internal applications available to other companies using the ASP model. GM is not the only motor manufacturer to show an interest in ASP initiatives. Ford Motor Company last September sank funds into hosted corporate expense management vendor Captura. And both automotive titans have joined with DaimlerChrysler, Nissan and Renault to form the mammoth online marketplace venture Covisint, whose technology platform is being jointly engineered by Oracle and Commerce One. IBM seized the opportunity of this receptive mood at the show to launch a new application hosting service of its own. IBMPlaces.ihost.com is a B2B portal offering a range of auto industry-specific applications, from vendors such as IBM subsidiary Lotus Development and third-party ISVs Synapz and IQS. It will also provide interoperation with Covisint and other exchanges serving the automotive industry, thus acting as an aggregator both of applications and of online commerce services. Sourcing online applications and services, said IBM, is a logical extension of the long-established trend within the auto industry to outsource information technology operations. It is not the only long-term trend in evidence as the industry's leaders embrace the ASP model. GM's proposal to earn extra revenues by renting out portions of its substantial internal IT resources echoed a prediction made only last week on ASPnews. Columnist Peter Slavid, drawing parallels between ASPs and the computer bureaux boom of the early 70s, said "some of the smarter customers [will] set up in-house ASP services and use that to generate external revenues." See A Lesson from Service Provider History, Jan 2nd 2001. This development is a natural evolution of the ASP value chain. The ASP model is gradually converging with a broader trend, one in which Internet-based computing is becoming the platform for automating all business-to-business services. In this emerging landscape, larger enterprises are not only consumers of Internet-resident computing. They will also increasingly become purveyors of Internet-based automated services to their suppliers, partners and customers. The thinking now taking place at GM is a sign that the automotive industry is already ahead of the curve on this particular trend. Whereas GM has substantial internal IT resources already available to deploy on its ASP ambitions, leading names in other sectors may be wondering how they will cope with building and managing applications for whole new communities of external users, on top of their own pressing internal needs. Into that breach steps NetObjects Inc, nearing the end of its long-planned transformation into an ASP platform provider with this week's sale of its enterprise software products divison — see related ASP News story on internetnews.com, Merant to acquire NetObjects division, Jan 12th 2001. Late last year, NetObjects launched Matrix, a platform that enables ISPs, banks and other business service providers to provide a range of website, e-commerce and e-business services to their small business communities, fully integrated with their existing Internet presence and branding. See NetObjects Fulfils Online Strategy With Matrix, Nov 5th 2000. At the time, NetObjects had also agreed to purchase online website enhancement provider MyComputer.com, intending to offer its portfolio of services within Matrix. But subsequently — wisely in our view — it decided against the acquisition, preferring to source services primarily from third parties as a neutral aggregator. NetObjects is one of a number of web intermediaries emerging in the market today who are carving out a role packaging up web services for onward delivery within the ASP value chain. They will provide much-needed support to the vast majority of enterprises that need to offer online services to their smaller customers and partners, but who lack the in-house resources to assemble them from scratch. This review of the week's news highlights is by ASPnews.com founder and managing editor Phil Wainewright. A comprehensive news digest is published every month in the ASP News Review newsletter, available exclusively to subscribers. |