RealTime IT News

European Small Businesses Know ASPs

Frost & Sullivan, a marketing consulting company, today released survey results that indicate growing awareness of the ASP model among small and medium-sized businesses across Europe.

The company questioned a sample of 150 predominantly IT managers at companies with up to 250 employees, drawn from a range of vertical markets.

According to the study, overall awareness of the ASP value proposition in Europe is high with 74 percent of companies surveyed saying they were aware of the ASP principle and could supply an accurate definition of the term.

Front & Sullivan defines the term as follows:

An ASP manages and delivers application capabilities to multiple entities from a data center across a wide area network (WAN) or the internet.
While there are numerous companies that use ASPs to host their applications, the Frost & Sullivan report defines an ASP as the entity that owns the customer relationship.

According to the study, the two most commonly outsourced applications are accounting (19 percent) and messaging (16 percent). The popularity of those two applications can be attributed to their lack of integration requirements, according to Frost & Sullivan.

"It is clear that, while attitudes to the ASP model are not uniformly positive, nonetheless, there are enough companies willing to evaluate the concept for us to claim this as a positive statement about the future," said John Gilsenan, research manager at Frost & Sullivan.

In terms of brand awareness, Oracle came out on top, followed by IBM Global Services, Microsoft, BT Ignite and Telecomputing. The only pure ASP in the top five suppliers was Telecomputing, pointing to a sign of weakness in ASP's marketing clout, according to Frost & Sullivan.

While awareness of the ASP model runs at high levels, acceptance of the model and uptake of services is still quite low, according to Frost & Sullivan. Dissatisfaction tends to revolve around the inefficiencies of the network rather than the ASP's inability to deliver what was promised.

"Customers have a tendency to blame their ASP for any problems related to the networking infrastructure, even if it is not the ASP who deals with this service aspect. The provisioning of adequate networking infrastructure by the ASPs themselves is projected to be one of the most distinct differentiators," said Gilsenan.

Lower total cost of ownership metrics of ASPs isthe prime motivator for 63 percent of respondents' decision to outsource, the report said. A total of 47 percent of survey participants state the lack of in-house expertise and the struggle to attract and retain a qualified workforce as key factors behind the migration decision.

Security concerns top the list of factors discouraging customers from outsourcing, capturing 66 percent of responses, followed by the performance of outsourced applications (49 percent) and service and support (42 percent), according the Frost & Sullivan.

The survey was conducted in ten European countries (the U.K., Germany, France, Italy, Spain, Belgium, Netherlands, Denmark, Sweden and Norway).