While information technology executives cite a number of benefits from using an application service provider (ASP), many users remain concerned about issues associated with accessing applications via a subscription model. Among the issues that raised concerns: integration, vendors' longevity, loss of control and security.
Only one-fifth of responders to a recent survey conducted by the Arlington, Virginia-based Information Technology Association of America (ITAA) currently use an ASP. Of those, two-thirds said that access to high-end applications, increased flexibility and lower up-front capital expenditures are key benefits.
More than half of these ASP customers also cited guaranteed performance, the workforce shortage and reduced implementation time as other reasons for using an ASP. The survey drew responses from more than 1,500 information executives, who filled it out online after seeing it posted on one of four IT information sites, including Computerworld's US web site.
Among survey respondents, 50 percent of those who do not use an ASP plan to in the future.
The most popular applications for ASP users to receive through service providers include financial and accounting software, customer relationship management (CRM) systems, e-commerce software and e-mail systems. About one-third of current ASP users have subscribed to receive each of these type of offerings.
However, about 40 percent of the respondents who do use an ASP said drawbacks include integrating the software with existing applications as well as concerns about the long-term viability of the ASPs themselves.Those who don't currently use an ASP were also concerned with security and loss of control, as well as being locked into a contract.
"If you're choosing an ASP, you're locked into a company for a three- to five-year period," said Amy Mizoras, a research analyst at International Data Corp. Although ASPs typically tout that they deliver best-of-breed applications, some users are concerned that an ASP can't offer, say, a particular CRM package, said Mizoras. As a consequence, the user has to select another ASP vendor to fill that specific need, which adds complexity to IT operations, Mizoras said. "The whole reason to go to an ASP is to simplify," she added.
Some ASP users say they try to overcome those drawbacks by not signing up with ASPs for applications that require 100 percent availability, or that are fundamental to business operations.
For example, six months ago Scott Cebula, executive director of information services at Memorial Care, a group of five hospitals in Long Beach, California, selected software from an ASP that analyses patient satisfaction survey data.
Since a period of downtime in this software would not have immediate clinical consequences, this application is an ideal candidate for an ASP to provide, he said. The information the software provides is important, but Cebula said, it's "not like the hospital would stop operating if this system were not available."
On the other hand, Cebula said he would never consider applying an ASP model to software tied to a heart monitoring system or any other application whose "failure has immediate clinical consequences."
Softrax, which provides software to manage IT infrastructure, and survey tools maker NetReflector.com also sponsored the survey.