SINGAPORE--Compaq and PricewaterhouseCoopers (PwC) have picked Singapore as a springboard for their newly-formed alliance to offer tailored ASP (application service provider) business solutions to Asean.
Called Tailored ASP Business Solutions, the alliance aims to "e-enable" customers with tailored ERP (enterprise resource planning), CRM (customer relationship management), SCM (supply chain management) and e-business solutions.
Target customers are those in the medium to large enterprise space across all industries, said Compaq Singapore managing director Eric Goh.
In line with the Compaq-PwC alliance, PwC will review the customer requirements as well as customize and deploy systems covering the ERP, CRM, SCM and other e-business functions. Compaq will deliver the IT infrastructure and related services according to what is required. Depending on which partner the customer signs with, that partner will be the contact point for the customer. Revenues will be shared between the partners, depending on which is required to do more work.
The agreement between the companies is non-exclusive, but Compaq considers its decision to enter the ASP market "a natural extension" of its working relationship with PwC, said Compaq Global Services Asia Pacific director of sales and marketing Phillip Attard. Compaq wants to be known as more than an infrastructure provider and more as a solutions company, said Attard. The company hopes that customers will be able to see this with this alliance.
Citing figures from research firms Gartner and IDC, Attard said the global ASP market was expected to grow 60 percent to about US$1.6 billion by the year 2005. The Asia Pacific share of this services pie is estimated at 2.5 percent.
Either Compaq or an Internet data center (IDC) partner such as Singapore-based i-STT Pte Ltd (which is part of Singapore Technologies Telemedia) would host the customers business data. Any problems arising from data stored on a third-party location will be the responsibility of whichever partner the customer has signed with, said Attard. "We would not be using them (the third-party IDCs) if we were not confident of their ability to deliver."
Plans for expansion
The alliance is currently exclusive to Asia Pacific, starting with Singapore and Australia. Compaq and PwC are looking to launch their solutions in Malaysia sometime in August.
Singapore has been picked as a launching pad for Asean as the two firms believe that it is the more mature market, with sound infrastructure, good bandwidth and IDC support, according to Romel Papali, Compaq's business manager of Internet Services and Alliances. Compaq is currently in discussions with interested customers in other Asean countries and hope to target between five and 10 ERP/SCM customers in the region by the middle of next year.
Currently, only SAP's solutions are offered by the alliance as a management tool, but Phillip O'Prey, senior technology solutions partner with PwC Consulting East Asia, said the alliance was looking at bringing SAP's competitor Oracle on board soon. No time frame was given, but PwC's Stephen Wise said that a meeting with Oracle had been arranged.
Wise added that PwC was looking at including other vendors, but did not elaborate.
When asked about the decision to bring a new ASP into the market during these uncertain times, Attard said both Compaq and PwC were confident of the success of their alliance and foresaw a consolidation of the ASP industry, both in Singapore and globally. Attard said that Compaq had been watching the market carefully and put this alliance together according to their findings and feedback.
The feedback they received was that customers on the lookout for an ASP provider considered reliability, presence and financial viability most important. They did not want to risk the possibility of their data suddenly not being accessible should the host collapse or disappear.
When asked about possible competition or conflict with the ASP Center set up by NTU, Sun Microsystems and the Info-communications Development Authority of Singapore (IDA) here last month, both Wise and Goh stressed that there would be none.
Wise sees the role of the ASP Center--with its incubation of companies with ASP aspirations from concept to deployment--more as creating and raising the acceptance of ASPs here. The Compaq-PWC alliance, on the other hand, is focused on tailored e-solutions.
Sun itself is positive about this Compaq-PWC alliance. It believes that the proliferation of ASPs would help boost the widespread use of IT in an efficient manner in Singapore.
The minimum period for signing on with the alliance would depend on the level of SLA (Service Level Agreement) requested by the customer (the most basic being about three years). Customers do not have to pay upfront for the services. They only start paying once the system requested is turned on and accessible. Then, the costs would be charged at a fixed monthly rate. This would make IT expenditure clearer to companies and more attractive to companies, Papali said.
However, O'Prey said he expected a customer to sign on for up to five years in order to benefit from cost-savings through outsourcing to an ASP. Neither Compaq nor PWC could provide any details on the service charges.