Living on the Planet of the Apps

By Brian D. Rossman

Every week the irrepressible Internet economy spawns a new catch phrase for areas that have become "the next big thing" for investors and commentators. First, it was Internet Service Providers (ISP). Next, it was ecommerce. This led to a business-to-business focus, or B2B. Simultaneously, and still continuing, is the love affair with bandwidth, the pipeline of the information superhighway. Now, the stage is set for Application Service Providers (ASP) to take over the spotlight.

What is an ASP? To understand, we, first, must examine the definition of an application. An application is defined as the tool used to complete a task. For example, Microsoft Word is a word-processing application, that can be used to complete a letter. When an application becomes ubiquitous and indispensable to our daily lives, the application becomes known by the nomenclature, "killer app," as in killer application, or something we cannot do without.

Email is the first, and, some say, the only killer app in this new industrial age. Email is an electronic communication application that has no geographic barriers or usage charge. Email is used everyday in a variety of ways, from maintaining social contact with marginal acquaintances to making work-related inquiries. It is an indispensable utility. If you don't believe me, ask yourself, "Which do you check more frequently, your email or your phone messages?"

Application Service Providers are companies that provide applications for their users. Why are they "the next big thing?" The ASPs provide access to, and ease of use of, applications stored on the ASP's server through a browser, which is used to search the web.

Users benefit by being able to "rent" the application, rather than purchase it. For example, imagine you didn't have to purchase word-processing software for your computer. Instead, whenever you wanted to write a letter, you went to the ASP's website to use their word processing application. Once you finished your letter, you pay your fee and leave.

No need to purchase software packages or updates; no need to worry about installation requirements. Think of it as the equivalent of going to a copy center to make a copy. You only pay for the copies you use, not the entire machine.

Is this a big deal? You bet. Ovum, an independent research and consulting company, forecasts the ASP market will reach $43 billion in revenues worldwide by 2004. That is a lot of apps, even if none is a "killer," as email is.

With a market that size, I started to wonder what the next "killer app" would be. Email is the standard bearer, because it made our lives easier. It provided a new medium for instant communication, that is far-reaching, less invasive and involves less effort. What else in our daily lives could have such an effect?

Saving time is a big hit with people around the world, especially in Silicon Valley. The next "killer app" would have to save significantly more time. Shopping without going to the store? Clearly, that has been done tenfold. What if the shopping was done without your participation? Based on your purchasing habits over the past 12 months, the smart shopper™ selects and purchases your groceries, clothes and household supplies through your online billing system. Timesaver, yes. "killer app," maybe.

How about attacking that terrible commute? Traffic cams, traffic updates and telecommuting offer some relief. However, the traffic situation is rapidly deteriorating. What can be done? The "killer app" of metering lights, of course. Like their onramp cousins, this method of who goes first would reach you in your car, through your net appliance.

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