When your ASP goes under

In 1999, Alice Hill thought it looked perfect. People would use their desktops to rent the latest software from ASPs. But what happens when they fail?

COMMENTARY--In 1999, I wrote a column heralding the arrival of a new type of software, or rather an innovative new way of getting software from manufacturer to buyer. The Application Service Provider, or ASP, had all the makings of a new economy hit: Expensive packaging and distribution would be abolished, updates would be seamless and frequent, and small businesses would be able to compete with the big boys by basically renting costly CRM and sales-force-management packages online by the month.

At the time, reader response to the column was mixed. "Why would I trust my company's precious data to a Web site?" the anti-ASP camp pressed, while the pro-ASP crowd exclaimed, "Finally, a better way to get the software up and running!"

Torn between two models
In many ways both sides were right. The ASP model is elegant for many inarguable reasons. Using the Web browser as the application "window" eliminates a huge IT headache right off the bat. By not having to configure and install software on every PC, consumers are able to get online, set up a password and start working without the months of integration, training and fine-tuning a custom-built solution demands.

Since the ASP is able to save money on software distribution and packaging, it too can hone in on just the "work" and offer regular updates to the software without sending out disc after annoying update disc. The updates happen behind the curtain--leaving the consumer free to enjoy the changes, and the ASP free to innovate and repair without a fixed and costly timetable.

But what happens when the ASP you know and love goes under?

I learned this firsthand when my personal ASP of choice, Sportbrain, closed up shop. Sportbrain was a fitness gadget you clipped to your waistband. At the end of the day you uploaded your data to a password-protected Web page and tracked hundreds of fitness stats, many of which were automatically displayed as charts and graphs.

When Sportbrain closed, my six months of daily data went with the company, not me. Because the browser was the only software I had on my PC, I had no way to open the window on my stats, and worst of all, with no place to dial into. The Sportbrain gadget was 100% brain-dead, even though it would still collect information I could no longer pry from within the device.

The pain experienced by the loyal customers was chronicled on the bulletin boards during the final days of the company. Many people came up with solutions, offering to pay for the service, or find a way to trick the device to dialing the local PC, but in the end, the site was shuttered and our data was history.

Lessons learned
There’s no great flash of light on the "answer" but it bears pointing out anyway--the company you choose should be worthy of the data you entrust to it. In other words, if you just want to store some MP3s online, then a start-up storage provider is not going wipe you out if they get wiped out. But if your livelihood depends on the data, you’ll need an ASP you can trust. And in this climate, that means a big name. Period.

Oracle, Microsoft, and the other big names are working as we speak, to fine-tune the power of the ASP model, which means greater safety but probably no great savings. Consumer-based ASPs continue to be the most vulnerable, but are also less deadly. What this means for everyone is that the ASP model isn’t going away, but like all things Internet these days, we’ll just title chapter one, “You get what you pay for” and chalk it up to experience.

Alice Hill was VP of Development and Editorial Director of CNET.com. She regularly writes about technology for ZDNet and Computer Shopper magazine and helps companies abroad build better websites. Her favorite topics include "Buying mistakes beginners make", "Becoming a virtual merchant" and Do you TiVo? Subscribe to her free technology newsletter at http://www.alicehill.com.