iFuel Explodes into Euro ASP Market

ASP aggregator iFuel launched in London today with 11,000 users signed up across 11 mid-size business customers. Delivering an initial portfolio of 10 applications from vendors including Microsoft, Onyx Software and Systems Union, iFuel set out its ambition to lead the European ASP industry, with a minimum target of 250,000 users across Europe by the end of 2002.

“We think ASP has the potential to do as much for the delivery of software and services as the Internet has done for the delivery of information,” said CEO Eamus Halpin. “When people get the message this is how it’s going to be delivered — particularly in SME-land — we think this is going to take off big time.”

iFuel will offer its services through software vendors’ reseller channels rather than directly to end users. Based in West Drayton, near London’s Heathrow airport, the venture is a spin-off from Integration, a UK-based systems integrator that started delivering applications using the ASP model three years ago. Integration becomes iFuel’s first channel partner, with ASP contracts already in place to the value of £15m (US$22m), generating around £350k (US$500k) in recurring monthly revenues.

Today’s launch marks the beginning of iFuel’s public marketing of itself to prospective partners among independent software vendors (ISVs) and their reseller channels. The iFuel name will not be strongly promoted as an end user brand, Halpin told ASPnews.

The venture’s channel background has led it to invest in infrastructure and methodologies that will support resellers moving into the ASP market. “Resellers need a lot more help to get there. Vendors who are looking at just ASP enablement are missing the trick,” said Halpin.

iFuel will leave ISVs free to set their own ASP licence pricing, and to decide the share that goes to the reseller. It will charge a per-user, per-month subscription fee for its own services, out of which it will pay a commission to the reseller. The iFuel service includes measurement, calculation and invoicing of the fees and commissions, but the customer relationship will be with the reseller.

ISVs will not have to pay iFuel to have their software ASP-enabled for the service. “If you want to stimulate access to the ASP marketplace, we don’t think it’s realistic to put a barrier between ISVs and ASP,” said Halpin.

But iFuel will pick and choose the vendors it works with, and they will have to commit to a two-year contract and active promotion of the service to their channel, as well as meeting strict technical criteria.

iFuel launches with ten applications in its portfolio, and plans to extend the number to fifty by the end of next year. The current lineup includes Microsoft Office and Exchange, Onyx customer relationship management, financials from Systems Union, professional services automation from SharpOwl, and knowledge management-related products from KMS, Task Accelerators and 80-20 Software.

Integration had previously announced partnerships with ASP platform vendors Citrix, Novell and RSA. See related ASPnews story, Euro ASPs spring to life, Mar 25th 2000.

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