IBM expands hosting service options

IBM Corp. is expanding the scope of its hosting services by adding support for SAP AG and Siebel Systems Inc. applications, as well as for its WebSphere Application Server.

IBM's Application Hosting Service gives customers access to computing resources within IBM's e-business hosting centers around the globe. IBM also is making use of its SAP and Siebel expertise to manage and monitor the software deployments.

Customers purchase their own software licenses, either independently or through IBM, and IBM handles the logistics, says Dave Mitchell, global offering manager for application hosting services within IBM Global Services.

"We're going beyond managing infrastructure and moving into the application layer, and providing support services for application monitoring and application administration," he says.

The SAP offering includes support for enterprise resource planning and mySAP.com applications over the Internet. With Siebel, IBM is providing support for Siebel 7 general and industry-specific applications. The WebSphere service offers WebSphere Application Server 4.0 or WebSphere Commerce Professional Edition 5.4.

National US gift retailer Things Remembered uses IBM to host its WebSphere Commerce application, which operates within the company Web site. Mark Fodor, director of e-business at Cole National, the parent company of Things Remembered, says IBM's service gives him flexibility to respond to spikes in traffic during hot shopping periods.

Customers reluctant to move into a completely outsourced model can take advantage of IBM's Services Anywhere option, in which IBM hosts the application but the physical infrastructure remains on the customer premises. In instances where the application is hosted in IBM data centers, customers are given real-time access to system performance through IBM's e-business Hosting Connection portal.

"We looked for reasons why customers were not outsourcing SAP and Siebel, and it came down to three things: concerns over control, capital investment and complexity," Mitchell says. "These offerings are built to address those."

Analysts say IBM's announcement lends credibility to the application service provider (ASP) model, which has taken a beating during the past year or so.

"IBM has all the skills and resources to be the largest and most successful ASP if it wanted to be. But it hasn't really put its attention on this market for whatever reason," says Jessica Goepfert, an analyst with IDC. "They've grappled with what role to play and here they are coming out pretty strong saying we do have our own direct offering."

Pricing for the application hosting services varies by customer.

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