Application Service Provider (ASP) Hosting Services: A Global Strategic Business Report
San Jose, CA (Vocus/PRWEB) February 11, 2011
Application Service Provider (ASP) business model overhauls the conventional client-maintained and client-licensed software model in the corporate IT market. Unlike the conventional model, wherein customers are required to pay huge license fee to software vendors, the subscription-based ASP model allows customers to lease or rent the software from the application service provider, and pay based on the usage metered. ASPs are typically third party service providers providing software and hardware required for hosting business applications of an organization, offsite. ASPs host packaged applications and provide them via a Web browser to their clients. This arrangement significantly minimizes the costs involved in managing traditional client/server architectures, and further the need for purchasing and managing expensive servers to run software, as in case with the conventional approach. The recession has resulted in the popularity of certain types of business models, which exhibit the capacity to withstand financial pressures and uncertainty as inflicted by the current recession. The economic hardships of the past two years have thrown the spotlight on the ASP model, largely because of the fact that companies are migrating from the conventional practice of purchasing expensive licenses to those that can be rented or hired at relatively lower cost monthly subscription fees.
The strategy of providing application services in a hosted data center style has struck the right cord among recession-hit enterprises, since moving mission critical applications to the ASP model managed by a third party, provides cost benefits that cannot be undermined in the current economic climate. Therefore, it is of little surprise that despite two long years of economic recession, budgetary constraints, lack of capital for investments in IT assets, reduced corporate spending and the general strategy of “doing more with less, the market for ASP hosting services has successfully dodged the bullet.
The recession has interestingly laid bare serious issues in IT cost management, the resolution of which is forecast to continue even into the post recession period. Recession induced changes in IT buying behavior in itself presents a business case for ASP hosting services. Ease and speed of implementation of IT solutions, quality and easy availability of vendor support, product features accompanied by low price tags represent the new purchase decision variables pushed forth by the recession. Preferences will remain skewed towards IT solutions that help bring down the true total cost of ownership of an IT project. And given the numerous cost benefits offered by ASP services as a business model, market prospects continue to remain attractive. As the new economy emerges from the recession, companies hitherto painfully bogged down by cost/financial pressures and acute IT infrastructure challenges such as, application bottlenecks manifested in the form of lower response times, data center space constraints and ineffective hardware scalability, are currently emerging wiser from the economic pressures with an eye for cost effective solutions.
Investing financial resources to reduce overheads and save money in the medium-to-long term is the prevailing sentiment in the enterprise IT front. ASP hosting services, in this regard, offer numerous business benefits, such as, lower cost of ownership, negligible capital expenditures, and rapid deployment. Leveraging ASP services is therefore emerging into a major recession proofing strategy for corporate IT departments. Although the recession is currently at its tail end, most companies will still continue to feel the aftershocks of the recession. This post-recession fiscal pain will mean that although improving, recovery in IT budgets will remain anemic in the immediate short-term, thus magnifying the cost attractiveness of ASP services for companies seeking to invest precious resources in sophisticated yet economical IT infrastructure.
As stated by the new market research report, Europe and United States account for a lion’s share of the global Application Service Provider (ASP) Hosting Services market. Post recession, top business goals, across industries, will include revenue growth, trapping new customers, decrease operational expenses, effective utilization/management of IT budgets through reduction in capital and operating costs, simplification of software management, easy and cost effective access to Gen-x application functionality, among others. Leveraging ASP hosting services helps companies to cut-down costs related to acquiring, installing, and upgrading dedicated in-house software applications. This remains an important benefit against a backdrop where the recession has considerably impacted the purchasing power of enterprises, forcing companies to go conservative on their service spending.
Major players in the marketplace include Ariba, Inc., HP Enterprise Services, International Business Machines Corporation, Intelligroup, Inc., Jamcracker, Inc., Oracle Corporation, Tata Consultancy Services Ltd, USinternetworking, Inc., among others.
The research report titled “Application Service Provider (ASP) Hosting Services: A Global Strategic Business Report” announced by Global Industry Analysts, Inc., provides a comprehensive review of market trends, issues, drivers, company profiles, mergers, acquisitions and other strategic industry activities. The single segment report provides market estimates and projections (in US$ Million) for major geographic markets including the United States, Canada, Japan, Europe (France, Germany, Italy, UK, Rest of Europe), Asia-Pacific (China, Hong Kong, Rest of Asia-Pacific), and Rest of World.
For more details about this comprehensive market research report, please visit – http://www.strategyr.com/Application_Service_Provider_ASP_Hosting_Services_Market_Report.asp
About Global Industry Analysts, Inc.
Global Industry Analysts, Inc., (GIA) is a reputed publisher of off-the-shelf market research. Founded in 1987, the company is globally recognized as one of the world’s largest market research publishers. The company employs over 800 people worldwide and publishes more than 1200 full-scale research reports each year. Additionally, the company also offers thousands of smaller research products including company reports, market trend reports, and industry reports encompassing all major industries worldwide.
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