ASPSecure.com Secures Funding, Clients

ASPSecure.com, supplier of Digital Rights Management (DRM) software and services to the application service provider (ASP) market, secured $9 million in its first round of financing earlier this month. The company was launched in September 1999 to address ASP integration and e-business opportunities.

According to the company, the money raised will be used to build up the company’s sales and marketing forces and to bring in consultants and application developers.

The group of approximately 15 investors included The Stephens Group (Little Rock, Ark), Roger Engemann & Associates (Pasadena, Calif.), First Albany Corporation (Albany, NY) and Kistler Associates (New York, NY).

Executive vice president Larry Howard explained to ASP News that ASPSecure.com provides the ability for a client to manage their digital rights by protecting rights of the people that own and manage the use of that content.

The standard practice in the ASP arena is to put the software on the Web site, from where the user will download and use the software. ASPSecure.com’s system allows for usage based on tracking.

“We can slice and dice a company’s software and tell who is using it,” said Howard. “The client can then decide if it is beneficial to bill by usage or implement a flat user fee. I think it will be a marketing decision each company will have to make for itself.”

According to Howard, an ideal client for ASPSecure.com is a software company that wants to move from subscription-based fees to a usage-based model, or an ASP that bills on a user basis –although the company has the ability to work with customers that employ either billing structure.

Howard disclosed that the company had already secured two clients, one of which is a medical ASP. “This medical client is putting up a collaborative Web site; that’s where we come into play,” said Howard. He declined to disclose further information about either client, but did say the company anticipates signing on 10 to 12 clients by end of 2000.

“We have a good lead on the technology that will secure medical documents,” said Howard. “It is a key part of our marketing strategy.”

The privacy issue revolving around posting medical records online has become a central topic, and companies desiring to do so have to be HIPAA (Health Insurance Portability & Accountability ACT) compliant.

According to Howard, ASPSecure’s pricing structure includes licensing and consulting fees. Total fees could run from $500,000 on the small business end, up to $2 million for a large business.