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December 11, 2001

It's December and the ASPnews team is making its list of the Top 20 ASPs and application infrastructure providers. In the spirit of the holidays, we are checking the list of potential additions twice. We have spotted three companies that are not only doing an especially nice job of finding success in the ASP market but are also helping to move the industry forward — for goodness sake. The three changes also reflect the shift that is taking place away from what many have called the first-generation ASP model.

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Self-Professed Non-ASP
Indeed, many companies are either getting out of the ASP business altogether or else redefining their business models so that they look less like ASPs. One example of the latter is BlueStar Solutions, formerly eOnline, which nowadays considers itself an application outsourcer rather than an ASP.

What's the difference some may say? To some extent, this is a question of semantics. But there is an important distinction. An outsourcer hosts software infrastructure that the customer could run just as well in-house (with the necessary investment in staff and equipment, of course). Whereas an ASP delivers applications or services using a software infrastructure that is designed to serve multiple customers, and which is thus inherently different than what the customer would choose to run in-house.

When an outsourcer uses a shared systems infrastructure that is tailored to the applications it specializes in, then it sits in the grey area between true outsourcing and true ASP, and BlueStar is a company that fits in that category. But since a part of our rating criteria includes innovation and leadership in the ASP model, BlueStar's success in revenue terms as an application outsourcer is not enough to retain its place in our Top 20 listing.

Up to the Outtask
Replacing BlueStar is Outtask, which offers an innovative portfolio of services that complement its customers' existing enterprise applications. The services include travel and expense management integrated with online travel booking, self-service HR, Web-based access to Siebel data and online support for Siebel users.

One of the interesting aspects of Outtask's offering is that there's a business service element to many of the applications — the company is providing automated end-to-end business processes rather than applications that automate just a part of the job. And each service seamlessly integrates into the customer's in-house IT using Microsoft .Net Web services.

Welcome Agiliti and MetraTech
The two other changes are on the infrastructure list. New entrants are Agiliti, whose ASP enablement program has helped some 75 ISVs adapt their applications for hosted delivery, and MetraTech, whose Web services-ready billing system is making substantive progress in the service provider market.

What is the ASPnews Top 20?

All entries in the Top 20 ASPs and the Top 20 ASP Infrastructure Providers lists are drawn from the ASP Industry Global 200 Directory, as published monthly by ASP News Review, the executive newsletter for the worldwide ASP and Web services industry. The companies are selected based on several factors. Sheer size is just one parameter, which is weighted along with more qualitative assessments, such as respect among peers and talent to innovate within the ASP model as defined by ASPnews (see The ASP Value Chain for a detailed description). For more on the process behind the Top 20 lists, see Global Top 20 — Your Questions Answered.

Falling off the list are Qwest Communications and Compaq.

Shortly after we added Qwest Communications to the Top 20 list, it ceased offering its Apptimum service to help resellers host Exchange, and transferred its existing customers across to QCS, its ASP offshoot. Like many others, Qwest has found it hard to encourage take-up of hosted Exchange among conventional resellers, a difficulty no doubt exacerbated by negative sentiment within the industry over the first-generation ASP model.

The other departure is Compaq, which has not yet come up with a response to that negative sentiment and which is also preoccupied with the repercussions of its proposed merger with Hewlett-Packard.

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