ASP Market Still Alive and Well: Focus and Specialization Generate Success; Aberdeen Identifies Winning Criteria for Application Service Providers

Business Wire, August 8, 2001

Business/Technology Editors

BOSTON--(BUSINESS WIRE)--Aug. 8, 2001

In a research report released today, Aberdeen Group, a leading IT market analysis and positioning services firm, reaffirms its belief in the value proposition of the application service provider (ASP) model and the ASP market as a whole.

"The ASP market is relatively young and still maturing. It is only natural that in this process business models will change and there will be continued experimentation," said Lew Hollerbach, Managing Director, Service Providers at Aberdeen. "Overall, however, the value proposition of the ASP model is too significant to ignore. Aberdeen forecasts that the ASP will continue to prevail despite any impending market realignment." The report, ASP Market Snapshot: Turning the Corner, analyzes current market trends, drivers, and adoption challenges, and examines market segments and their evolution. Some of the findings that Aberdeen's research produced include the following:

- In light of the economic slowdown that has occurred in the high tech sector
over the past 12 months, cost reduction has once again become one of the
primary business benefits that the ASP offers to customers.

- ASPs that are able to put together an effective partnership/alliance program
combining the best practices from a variety of fields will ultimately dominate
the market.

- CRM, collaboration, and e-Commerce applications were the most frequently
offered applications according to survey respondents, yet the individual
revenues of these segments represent only a small percentage of the entire
market in 2001.

The full details of Aberdeen's research findings are found in our new report entitled ASP Market Snapshot: Turning the Corner. Information on this and other Aberdeen research can be found at www.aberdeen.com or (800) 577-7891.

About Aberdeen

Aberdeen Group is a leading market analysis and positioning services firm that helps Information Technology vendors establish leadership in emerging markets. Steeped in technology and armed with end-user field research, Aberdeen answers clients' critical business and technology questions in the context of the Internet economy and across the product lifecycle. Founded in 1988, Aberdeen is headquartered in Boston, MA, and has research divisions in Palo Alto, CA; Fort Collins, CO; and Amsterdam, the Netherlands. Aberdeen is accessible via the Web at www.aberdeen.com.