Application Service Providers Overview

If you have a computer you no doubt have an Internet connection. If this is the case you are usually online, browsing websites, etc. If you think about it, the Web has been an integral part of our society since 1994, when the Internet really took off. Before we knew it, businesses started being formed online. These businesses included the likes of Amazon, EBay, and Epinions. These businesses are visibly active everyday. But there are businesses that work behind the scenes, who deliver software and services. This type of business is known as an ASP (Application Service Provider). This type of business is pretty attractive to other people as a start up company and way to make money. But before you decide to go into this yourself, you need to know some facts about ASP, what it is, and how it works. First of all, here are samples of offline ASPs:

 

·        Shipping: You obviously use some type of shipping company everyday. You either you FedEx, UPS, or DHL. You use either one of these because the cost of owning a shipping company or fleet of trucks is enormous.

·        Ma Bell: You would not see yourself owning a whole network of fiber optic cable and control a multitude of users besides yourself. The cost would be astronomical. So instead, we just pay a small monthly fee to use someone else’s.

·        Energy: Most people have the capacity to generate some form of electricity in their own home. But not the amount required to power a whole city or coastline. Therefore we would just simply pay a small monthly fee to use the electricity that power companies provide, knowing this is the cheaper way out.