European Market Ripe for ASPs

Two-thirds of businesses and organizations in the UK and Germany expect to purchase application services from an application service provider (ASP) over the next 18 months, according to the findings of a market survey commissioned by the ASP Industry Consortium and conducted by Ovum.

One-quarter of the companies contacted already believe they are using ASPs for payroll, Web site , and email applications. Though the respondents’ definition of an ASP may be somewhat broad and account for the high rate of usage, it does indicate that many businesses are using at least a prototype of an ASP model and that their remotely managed services are very likely to evolve into a more refined ASP solutions, according to the study.

The industry sectors that are most attracted to the ASP model in Western Europe over the next 18 months are banking and financial services, transport and utilities, and travel and tourism. The survey also found that the majority of those sampled would prefer private wide area networks to access their applications as opposed to public networks. Across industry lines, the preferred application services most often cited were Web site hosting, e-commerce, and email.

“This survey really demonstrates two points we’ve been trying to address through the ASP Industry Consortium,” said Traver Gruen-Kennedy, the Consortium’s chairman. “The first is that more education is needed as to what an ASP is and what the benefits of this delivery model are. The second is that there is obviously a comfort level with outsourcing among businesses and organizations in Europe, so we can expect that the ASP industry will continue to grow as more and more people become familiar with it.”

European Interest in ASPs
European
Region
Percent Likely to Use ASP
in Next 18 Months
Germany 66%
UK 66%
France 40%
Scandinavia 25%
Source: Ovum

Within the banking and financial services sector, the sector most interested in making use of ASPs, preferred application services most often cited were Web site hosting, e-commerce, and customer relationship management.

Within the transport and utilities sector, preferred applications also included email, payroll, and desktop productivity. More than half of the respondents in these industries said it is likely they will be using an ASP in the next 18 months, as did more than half of the respondents in the travel and tourism industry, who also included Web site hosting, e-commerce, email, and desktop productivity among their preferred applications.

Exactly half of the respondents in the retail and distribution sector believed they would be using an ASP in the next 18 months, with Web site hosting, email, payroll, and e-commerce cited as their preferred application services.

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