Packeteer sets sights on ASPs

Network management software company Packeteer has set its sights firmly on the emerging application service provider (ASP) market in Australia at the same time that analyst International Data Corp (IDC) has announced partnering with ASPs is a whole new ball game.

In an attempt to grow its international revenues, Packeteer's vice president of marketing, Todd Krautkremer, visited Australia last week, evangelising to local ASPs about the virtues of the company's packet shaping software.

Packeteer posted strong results last quarter and Krautkremer told [ital]ARN[ital] the company is backing the early adopter nature of Australian enterprises to opt for the ASP model, rather than purchasing business applications outright.

Fifty per cent of Packeteer's revenues are derived from international sales and Krautkremer claims the Asia-Pacific region is growing the fastest, with 25 per cent of the company's overall revenues.

According to Krautkremer, the local ASP market is still largely in the initial phase of getting the infrastructure in place to offer services before it can focus on customers' needs, which he sees as being around 9-12 months behind the US.

Krautkremer outlined a number of critical areas for Packeteer's future growth, which include greater penetration into the enterprise space and service providers looking to move up the value chain by offering ASPs greater quality of service.

With a significant deal stitched up with the NSW Department of Education for its Technical Adult Further Education (TAFE) colleges, Krautkremer believes Packeteer offers resellers the ability to provide consulting services to their clients.

As well as stopping the "bleeding from the neck scenario" where an organisation's bandwidth is being consumed by non-critical applications such as Napster, Krautkremer claims Packeteer provides resellers with a tool to give their customers a snapshot of everything going across their networks.

Packeteer is also keeping its eye on the rising adoption of wireless networking and while Krautkremer claims the company's software is already geared towards managing wireless bandwidth, product modification around wireless applications is expected.

IDC's outlook: Not the same handshake

In related news, IDC has released the findings of its latest take on the ASP market, which sees partnering with ASPs as being a different kettle of fish to traditional vendor-channel, channel-channel relationships.

The study found the specific partnering needs of ASPs substantially differ from any other partner segment, and programs designed to meet the needs of other partner types are unlikely to satisfy the particular requirements and expectations of ASPs.

But despite this, IDC still predicts there are enormous opportunities for partnering with ASPs. According to IDC's Priority Partners Study, a significant number of ASPs are actively looking for service, resale, telecommunication, Internet service provider (ISP), and hardware vendor partners.

"ASPs are seeking partnerships with a variety of technology product and service firms, with a particularly strong emphasis on software vendors," claims Stephen Graham, vice president of IDC's Global Software Partnering and Alliances research.

IDC predicts spending on ASP services worldwide will grow to $US7.7 billion in 2004, from $300 million in 1999.

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