Beyond desktop and mainframe computing, advent of web technologies and
resulting shared applications are creating new ways to meet some or
almost all aspects of information technology (IT) needs. Concept of
application service provision has come a long way since it first came
on the scene in the late 1990s? Originally, the idea of virtual
cooperation and application sharing came from Bill Davidow, a fellow
venture capitalist and entrepreneur. What Bill foresaw as the future
of computing is already in practice; a new IT business model.
Hewlett-Packard and Qwest are among the pioneers for providing
application services. Microsoft also allows some companies to offer
its Back Office products, including SQL Server, Exchange and Windows
NT Server on a rental, pay-as-you-use basis.


Hi-tech developments and changes at a fast rate are moving towards
convergence of the software, information, technology carriers, and
computer engineering. Result: IT structural designs are shifting from
desktop and mainframe environments towards Internet based structures.
Similarly, software app
lications are altering from made to order and
separately owned solutions towards pre-packaged and Web based
solutions. It is in this context that ASP business model is getting
more interest as a hot trend.

IT business model that offers end users – small and large businesses,
government organizations, non-profits, and membership organizations
even individuals -- an access to applications and services over the
Internet is known as application service provider (ASP - not to be
mixed with Active Server Pages. It also is an abbreviation of as soon
as possible). It is sometime called software-as-a-service, on-demand
computing, apps-on-tap or utility computing.

Typically, the applications are deployed by a third party that hosts,
manages, updates software based services and solutions and distributes
to clients from a central location. XML and HTML processes allow the
clients to interact with the software. Sometime, ASP also rent out the
server hardware and the network. What is more, many ASPs, particularly
enterprise ASPs, have now started offering on site solutions in which
the relevant hardware, software and function remain on the customer's
site.