New Moon ASP’d On Me!

Question: How does an ERP, an ISP, or an SD become an ASP without the CRMs worrying the CFO’s when the CPAs say the B2Bs will get TKOd on the WWW?

Answer: Outsource, you dumb asp!

Like the rampant transition from a B2C to a B2B strategy, the ASP revolution has exploded as the chic (and sometimes very profitable) thing to do for new companies competing in the Internet economy. As for established offline companies, however, the virtual red carpet is harder to get down than it looks, and the crowd stuck behind the velvet ropes ain’t getting any smaller.

But one ASP is trying to help others join the party.

San Jose-based New Moon, which recently cashed in on the VC motherlode with $35 million from sugar daddy SOFTBANK, says it can take any software package on the Windows platform and seamlessly transform it into a ASP faster than a journalist gets sick of all these freakin’ abbreviations! Earlier last month the company partnered with San Francisco-based Autodesk, and portal giant AltaVista, to provide a fully-functional Web-based preview of Autodesk’s AutoCAD 2000, a popular customizable 2D and 3D design and drafting software package. And CEO Marc Lowe promises many more to come.

“We’ve got about six companies in our data center now, with 80 applications in the pipeline,” says Lowe.

Think of New Moon as an infrastructure service provider (ISV) of the new age. The company provides software tools and hosting services for other companies that want to become ASPs, specifically focusing on software developers in the Windows environment. By applying what Lowe will only refer to as the company’s “secret sauce,” he says New Moon can have a piece of software up-and-Webbing off the company’s proprietary servers within just a few days.

“We then send the developer a URL, where they can go through and test the new online version of their product,” continues Lowe. “And don’t misunderstand, it is still their product. We offer what we call the ‘full fidelity of the application.’ The look and feel is exactly the same. It IS Windows.”

Maintaining the existing environment is a plus from two angles. Firstly, developers can re-design the software using the same standard Windows programming language they used to design the application originally, making upgrades and Internet optimization a comparative breeze. Secondly, end users don’t have to learn how to use a new product, a clear benefit for offline software makers with an existing user base who want to offer their product online.

“Take Quicken and its popular accounting software,” says Lowe. “They’ve been selling accounting software for a long time, and have a very established presence. But now you have NetLedger, a pure play, ‘use-on-the-Net-for-$10-a-month’ service. Quicken is eager to match that, and by providing their users with the exact same interface that they’d get if they pulled the software out of the box, Quicken can!”

An established presence is what attracts New Moon to software vendors. In an age where there are seemingly more ASPs than there are customers, New Moon is hunting down clients with an existing brand and customer base, as well as the back-end to handle customer support (a common flaw in the pure-play online world).

“We just come in and offer them a one-stop shop to get all those resources online,” explains Lowe.

To use any of New Moon’s ASPitized apps, users first download “LiftOff”, a one time, one-megabyte plug-in, which interacts with the online software on New Moon’s server. Once an application is launched it appears exactly as if it were running locally.

The bulk of New Moon’s revenue comes from software vendors paying for the proprietary hosting service, depending on the number of users they want (typically between $150 to $250 per concurrent user per month). Aside from hosting, New Moon also collects information on billing, register’s customers,

and provides metering data so clients can learn more about how their product is being used.

“It also helps prevent some of the $12 billion dollars software vendors lost to piracy last year,” says Lowe. “Because the software itself is never downloaded, and therefore it can’t be copied.”

No one has yet to copy New Moon either, at least not exactly, likely because LiftOff was originally developed by New Moon in 1995 for use by corporate IT departments wanting to host applications centrally. In other words, the company has a relative lifetime of experience in that sector of the technology. The company is also working on what Lowe calls the “New Moon Distribution Network,” where high traffic Web sites will eventually host virtual shopping malls of rentable applications.

“We’ll be announcing some major deals with very large sites in the coming months,” says Lowe, with no small hint of excitement in his voice.

Let the party begin (just make sure you RSVP).

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