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NEWS
Microsoft gears up ASP strategy

Sep 18th 1999: Microsoft moved closer to the launch of an ASP strategy in a series of announcements this week, and highlighted existing partnerships with ASPs including data network provider Equant, which announced the formation of a global ASP operation.

In a press statement, Microsoft for the first time publicly confirmed its plans to launch a series of application hosting bundles for service providers, with an announcement likely within the next month or so. Meanwhile, company president Steve Ballmer revealed the company's growing strategic commitment to application hosting.

"We will really push to be a leader in this environment, making sure there's hosted Windows desktop services, Office services, Exchange services, et cetera," he told attendees at a press briefing for Microsoft's Windows DNA 2000 launch in San Francisco CA on Monday (Sep 13th).

The imminent launch of the long-awaited Complete Commerce range - a set of bundled application solutions designed for hosting by service providers - came as Microsoft released the first bundle in the scheme to general availability. In pilot since November last year, and now in its third iteration, the ecommerce site package was initially launched on a trial basis with ten US service provider participants at the beginning of this year.

Since the spring, Microsoft has been piloting a range of other bundles with twenty-five provider partners worldwide, including Concentric Network, DataReturn, Digex, Exodus, Futurelink, GTE Internetworking, USInternetworking, Interliant, MCIWorldCom, NaviSite, Qwest Cyber.Solutions and USWeb. The bundles cover line-of-business, knowledge management, corporate purchasing, customer relationship management, and financial management applications. These will now be launched before the winter, the statement confirmed.

Microsoft also stressed the breadth of other pilots and partnerships it has established with ASPs over the past year, covering applications such as MS Exchange, collaboration using Office 2000, corporate purchasing, media streaming and NT-based line of business apps.

It highlighted Exchange hosting by leading data network and managed service provider Equant, which separately announced plans for an aggressive entry into the ASP market, delivering Microsoft-based solutions to multinationals from a global network of application hosting data centres. The first are being established in Atlanta GA in the USA, London UK and Sydney Australia, providing fully synchronised, mirrored global data infrastructure for its ASP customers. Equant has headquarters in Amsterdam and Atlanta and is listed on the New York and Paris stock exchanges.

Microsoft revealed details of a project codenamed Central Park, a hosting platform for business partner network services that it already uses for its own partner extranet. Hosted by GTE Internetworking and the result of over 18 months' work by the two companies, it now supports 6000 users in over 600 partner organisations using 200 different applications, Microsoft said.

Central Park is now entering commercial trials as a partner network platform with other companies, hosted by GTE and Qwest Cyber.Solutions (QCS).

QCS parent Qwest a few days previously (Sep 9th) had became the inaugural participant in a pilot of Microsoft's new Certified Commercial Network Services Provider (CCNSP) scheme, designed to certify providers of Windows 2000-based hosting services who target small and medium-size businesses. The pilot will initially run in the USA and is aimed at telcos and ISPs wishing to reach the volume business market with hosted Windows-based applications.

In San Francisco, Microsoft executives unveiled Windows Distributed interNet Architecture (Windows DNA) 2000, its new architecture for building distributed, Internet-based applications and services. "That's really the next frontier for developers - how do you take any piece of software and make it a manageable, deployable, programmable service on the Web," commented company president Ballmer.

As part of the launch, Microsoft announced AppCenter Server, a product for deploying and managing Web-centric, Windows 2000-based applications in a server farm environment. Designed to provide manageability, scalability and reliability, it will include features such as self-healing of faults, single-image application monitoring across multiple servers, dynamic load-balancing of COM+ component execution across multiple servers, and load testing and capacity analysis tools. AppCenter is due for release in the second quarter of next year.


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Copyright © 1999, Farleit Limited. All Rights Reserved.

ANALYSIS
It seems the penny has dropped in Redmond, and in a big way. Microsoft has recognised the rapid rise of a brand new channel in the form of the ASP industry. At the same time, it has been channelling its development architecture towards a Web-centric model. And for the past eighteen months, it has been working with GTE to engineer the world's most extensive deployment of application services, albeit to its own business partners. The wake-up call has been the realisation that application services represent the common thread running through all three of these separate strands, and at last its strategy is taking shape. But one huge question mark hangs over the entire picture. Through all these interlinked announcements, there is not one whisper about licensing. Can Microsoft bite the bullet and adapt its business model to the new application services paradigm? We will not have to wait much longer to find out.

LINKS

Microsoft:
o Corporate site
o Complete Commerce press release
o Central Park case study
o CCNSP press release
o Windows DNA 2000 announcement overview
o AppCenter press release
o Transcript of Steve Ballmer's presentation

Equant:
o Corporate site
o ASP press release
o Managed Exchange press release

Related ASP News Review stories:
o MS begins app rental pilots (May 26th)
o Microsoft to allow apps rental (Feb 1st)
o GTE launches 'super-provider' (Jul 15th)