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ASP (Application Service Provider)

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Note: Many topics at this site are reduced versions of the text in "The Encyclopedia of Networking and Telecommunications." Search results will not be as extensive as a search of the book's CD-ROM.

An ASP is a company that provides application hosting for customers in the same way that ISPs (Internet service providers) will host a company's Web site. The basic model is that mobile users or office users connect to the ASP to run their applications. The advantage is that the ASP has a fully managed data center run by professionals with all the facilities to provide fault tolerance, data backup, high availability, application maintenance, product support, and so on. Users connect via Internet connections, or in some cases, private lines may connect companies with their ASPs.

ASPs figure into the network computing concept. Clients run applications at their ASP. The device they use does not need a hard drive. The ASP is the hard drive and stores the client's desktop. The device simply displays information and takes user input from the keyboard. All of this is done over the Internet. See "Thin Clients." for more information.

Basically, ASPs provide outsourcing services. Many companies already outsource accounting functions such as payroll and employee benefits programs. The ASP can handle these applications, as well as many others, such as electronic mail, groupware, and collaboration software. Outsourcing these services can help companies reduce operating costs. For example, a company might wish to use Microsoft Exchange as its groupware application, but might not have the in-house expertise to manage the product. Outsourcing to an ASP takes advantage of the ASP's services and technical expertise. Costs may also be reduced in terms of software licensing and hardware.

ASPs may also host entire e-commerce and e-business (extranet) solutions. The ASP may provide essential add-on services such as credit card authorization, database management, and enhanced searching tools. They may use advanced Web hosting technologies including load balancing and caching of sites to multiple locations, possibly at other sites around the globe. ASPs may also provide high-speed direct links to the Internet to ensure adequate bandwidth for their customers and can provide additional services to take advantage of this bandwidth like QoS (quality of service) options.

Some ASPs provide specialized services to select groups. For example, an ASP might specialize in providing various accounting and specialty services for small contractors. Other ASPs may specialize in managing applications such as PeopleSoft or SAP products. The WebHarbor site listed on the related entries page breaks out ASPs according to the following categories:

Human Resources


Sales Force Automation

E-mail and Calendars

Remote Access

Customer Relationship Management (CRM)

Operations Management



Document Management

Project Management


Help Desk

Enterprise Resource Planning

Office Productivity


Another critical service is security. Some organizations may wish to outsource applications that include customer, client, or patient records. This information must be kept private and secure. An ASP can provide professional security services, something that most companies have trouble doing on their own simply because there is a shortage of security experts.

The ASP Industry Consortium was formed in early 1999 with the goal of establishing guidelines and producing standards for application sharing. The consortium members include AT&T, Cisco Citrix, Compaq, Ernst & Young LLP, GTE, IBM, and Sun Microsystems, among others.

FirstSense and a number of other companies are developing software to help customers of ASP services monitor application service delivery and measure performance.

The ASP News Review site listed on the related entries page has listings of ASPs and vendors that are in the ASP software and/or hardware business.

Copyright (c) 2001 Tom Sheldon and Big Sur Multimedia.
All rights reserved under Pan American and International copyright conventions.