Last
Edited: 07-17-2004
ASPCON
Application Service Provider CONvention
Orange County Convention Center
Orlando, Fla. May 23-25, 2000
10,000 delegates were registered for this conference.
Attendees were split
among 3 listed conferences (ISPCON, ASPCON, and CLEC Expo conference). Judging from
the exhibits, ISPCON had the most space and CLEC Expo was the smallest. ISPCON
started 4 yrs ago. ASPCON started 2 yrs ago.
I attended ASPCON to get a feel of what the ASP industry is like. Basically,
ASPs are the year 2000 version of the mainframe. Instead of accessing software
on your PC, you connect to a server over the internet and access software
resident on the server. This is a business service, not residential.
There are several ASP web sites. http://www.aspcon.com
and http://aspindustry.org are two. VGs
from this show are available at
http://ispcon.internet.com/spring2000/presentations.html
(username: ISP2kvip password: ISP2k71374) I noticed that VGs from the
early morning sessions were not available.
5-23-2000 Tues. 9:00am ISP Kickoff
3COM Speaker: Irfan Ali, Senior VP & General Manager.
Building the IP networks of the future.3 changes:
1) Significance of the internet: the medium of life. Just now gaining popularity
outside of the USA.
2) Trend to deregulation... Telecom act of 1996 gave CLECs...now global
concept.. traditional entry barriers now lowering...
will
see generic network service provider (no more Long Distance, wireless, etc.).
Consumers will be better off.
3) IP as a technology (3 yrs ago ATM was better) IP is now the platform of
choice for data, voice, FAX, and video. Expectations on existing IP networks are
too high. Just transport now, later must be service capable. Why? 12-15 yrs ago
in telco networks, services were tied to COs but IN came along (IN, IN2, AIN)
and proposed separation of apps from the underlying networks (e.g., Class
Services), SCE, modular service introduction. Today's IP networks are like
pre-IN COs. Need a 3 layered network (proposed)
3) Service Creation Layer
2) Controllers & Network & Service Mgmt.
1) Media Processing Layer
Slide showed Media Gateway Controller
(Signaling Gateways)... looked like a standard Softswitch network level
architecture diagram. Software, not hardware. Value is in the
software.
IP access closer to the edge.Tier2: PSTN SS7 Signaling, IP based.
Mgmt -> embedded-> element mgmt -> distributed mgmt -> service &
network platform (manage service)
Tier3: Service Creation Layer: Network Centric Services (Basic Authentication)
Examples: port wholesaling, grade of services (Voice & video limited
resources) (ex. FAX over IP is big in Asia) unified messaging.
Asking for like minded vendors to
develop to this vision (Softswitch IP network)
There were no questions taken after this plenary session. After the talk, I
approached the front and asked the speaker how he felt JAIN-Parlay fit into his
vision. I didn't get a useful answer.
5-23-2000 Tues. 10:25 ASPCON Keynote (~400 attendees)
Chairman & CTO Citrix Edward Iacobucci. Left
IBM from OS/2 group and started Citrix in 1989 "Software as a Service"
Nasdaq CTXS.
Products: Windows applications servers, Unix (Solaris) application servers,
video servers.
Indirect sales channels, OEM & industry partners. 1996-2000 high quarterly
revenue growth.
"To make using an application as simple as making a telephone call"
Any user, Any device, "delivery of services" TV & radio programs
... telephony services
Black & Decker: Customers don't
want 1/4" drills, they want 1/4" holes
Standard Interfaces: server based computing. devices are now simple
applications. How to manage server
farms? Single Image. see farm as one entity. As of Sept99,
over 250,000 Servers installed. Over 4,000,000 concurrent user ports....4
times as many as AOL > 15M ICA users.
As of May2000, >300,000 servers, 6M ports, 24M users installed in enterprises
small, medium, large.
Typical customer is a Hotel (Holiday Inn). They were using PeopleSoft
at headquarters.
Changed in 1997. Now remote access to peoplesoft via "metaframe" over
an Internet Service Provider. Why stop within the enterprise?
1998: pilot programs... w/telcos, ISPs
1999: New industry: IBM, Compaq, SUN, Cisco, Citrix.....ASP Industry Consortium
(14-300 members) Challenges are great!!
Showed 4 major layers: (we are not here yet)
1) Clients Computers, devices, appliances (simple
like a TV. Can't take TV apart for a Sopranos update)
2) Delivery (was CO) Network Service Providers. Telcos, Wireless,
ISPs, Cable. Direct Marketing Branded services, Customer Billing, connectivity,
network mgmt.
3) Hosting (want fee based hosting) ASP Application Service Provider
4) Content (new rules) ISV Indep. software developers. knows about
medical, car parts, etc.
- Software from a "packaged
product" to a "services" business.
- No geographic boundaries
- Info services delivered by telecom companies
- New companies
- leverage windows apps
- lots of vertical apps are on Solaris
- research broader market via NSPs
- HTML is not the best protocol for remote apps. Looking for standards w/o
plugins. in general, how to get a standard client/server interface?
- Channel development iBusiness. 90 ASPs. rent a CD to get started.
Summary:
- Model has been adopted by enterprise
- App service provisioning next
5-23-2000 Tues. 12:25pm to 12:50pm Lucent Luncheon
Lucent sponsored a luncheon and gave what I felt was the best
talk of the conference.
The slides and a video of the talk are
available at
http://www.lucent.com/serviceprovider/cybercarrier/aspsub.html
Talk was given by Mads Lillelund
who talked about the "Economy of
Light". It was basically a fiber broadband talk. The talk went
very fast so I didn't get a chance to take many notes. Fortunately the slides
and video are available.
- ASP Market: $3B in 1999 -->
$24B in 2003
- Today: Internet Economy...... Later: Economy of Light (Sycamore, SDL,
& other new companies)
- Today's ASPs are in a break even or money losing financial position.
(expenses are high)
- Lucent is not in the server
business, we must partner.
- Birth of ASP & Cyber Carrier
- 0.1 Mb/s to 100 Mb/s....new
services are available (video?)
- Note: it takes 3 yrs to design a car (a lot of this time can be cut
down)
- Download video games
- video is the biggest BW user
- 2 -way video cell phone: Broadband wireless. Too far out? a company in
San Diego is looking at it now.
- 1/2 of the $24B music industry
is distribution. wow.
- QOS and high BW
- Speed matters. Disrupt thyself.
5-23-2000 Tues. 1:30pm -2:10pm SUN Talk (~100 attendees)
Elizabeth King (Group Manager) from SUN gave a talk on ASP/.com market
development "App Hosting in the .com Economy".
The ASP idea falls directly into
what SUN does. SUN workstations are connected to SUN servers over a
LAN. The applications such as Netscape are shared and reside on the
server. SUN was very interested in pushing the ASP idea The speaker
asked "How many ASPs are in the room. There were fewer than 10 of the
100 or so attendees.
- SUN is interested in service delivery over the web. There has been a lot
of change in the last 12 months.
- $4.5B in 2003..... B-to-B $1.7T in 2004
- Oracle & Peoplesoft have
ASP versions. existing ISVs (Oracle business on-line, Peoplesoft
e-center)
- done.com bigstep.com
spacedisk.com some ASPs run on SUN.
- SUN made 3 bets in 1995: Internet, Bandwidth, JAVA Network Services
- SUN made 3 new bets in 2000: massive scale, continuous real-time,
software/hardware
- SUN tries to help ASP startups
get going.
- SUN tries to boot strap the ASP market
- Services, not apps, not servers
- 25 times more servers in the next 5 yrs.
5-23-2000 Tues. 2:30-3:30pm
Speaker from "Summit Strategies" talked about "7
rules on how to succeed as an ASP"
The room overflowed. there were 100-150 people inside with 50 people
in the hallway. The speaker was from a consulting company.
It appears that a lot of people want to get into the ASP business.
- $14-$120/mo vs. $1M/yr contract have different risks.
- Rule #5: Snap in application to extend the life of existing software
- get a "lite" version for startup customers. transition strategy
to new/bigger hardware.
- Have an anchor strategy (elevator pitch)...not number of press releases
- 2 yrs ago, this business didn't exist. 18
months ago this business didn't really exist.
- Software is moving from a
service to a utility. A service you can rent?
- McAfee.com virus software is a utility but they don't say it.
Like sox. Not sexy but you have to have it. (Microsoft SMS?)
- Ready-fire-Aim
- Lots of Q&A
5-23-2000 Tues. 4:30pm
ASP pricing model presented by John
Yin Daleen Technologies. Again a full house. (about 150 people). about 1/3
ASPs in the room.
- Free (ads), flat
rate, usage based
(based on resources used), transaction
(what the user does, not what the user uses) <the speaker didn't pick
one as the best>
- B2B marketplace is a subset of ASPs
- note: one can e-mail real drugs
& viruses... "I opened the e-mail but I did not
inhale"
- Value based pricing and billing
- price based on the value perceived (intelligence, personalization)
- bill based on the value delivered. (word used to write a business plan
vs. used to write a kids letter)
- can be any form/combination of the 4 pricing models listed above.
- Note: try to sell customers
things when they need it.. in real-time. example. You are using
word to write a business plan, the software notices this and offers to sell
you an example business plan, it then offers to sell you printing and
shipping service.
- Add services to keep customers
- bad credit? Are you set up for this... when people don't pay you?
- provide the right service to the right user at the right time with the
right quality and price.
5-24-2000 Wed. 9:00am Plenary
Bill Poole a Microsoft VP in Audio/Video talked about streaming media.
Digital Media
- March 2000: 79% PCs on the internet (50% a year ago)
- 42M use streaming media
- Exploding use of Music (especially college students.... Napster) 34%
download, 72% play music via the PC
- Windows media technologies:
- Create it: windows media encoder
- Distribute it:
- Play it: widows media player 7
- Different encoding from real G2, MP3
- Windowsmedia.com
- BB jumpstart... 750 kb/s mid-range DSL for compressed movies
- memory web surfing to send targeted ads. (e.g., look at Lexus web site...
later get Lexus ads from other sites)
5-24-2000 Wed. 10-10:30am SUN Plenary
I attended part of this session. SUN just gave ASPs definitions.
5-24-2000 Wed. 11:00am
Connie DeWitt. Application Delivery Infrastructure. Concentric: Your
Internet Service Provider.
- Thinking about ASPs: In 1990s
terminology, the ASP is like an integrator now delivering software via a
remote server.
5-24-2000 Wed. 11:15am
I attended part of a session on Financing. presented by Updata Capital
- 60% of today's ASPs will fail
by the end of 2001 (Gartner)
- Exodus $14,772M is the biggest ASP w.r.t. market cap. Others are Verio Inc
(sold to NTT), Digex Inc.
- 91% CAGR but stocks only 31% of highs (since the Nasdaq problems of
2Q2000)
- Need VC funding? go to a face-to-face networking function. don't just send unsolicited paper.
- Must claim profits in 1-3 yrs, not 5-6 yrs
- VCs want 30 companies in $150M fund run by 10 people.
- Angel (friends & family) --> seed (1-3M) --> expansion
- 70& of IPOs trade lower after 2 yrs... when employees start thinking
about cashing in on stock options.
- There are 12 M&A deals (e.g., sell to Microsoft, sell to Cisco) for
every IPO deal
- ERP market is cold.... CRM
market is hot
- How to get in before IPO? (Know someone at the company, or attend angel
group)
5-24-2000 Wed. 1:30pm
President's Panel. Paula Hunter (VP at cMeRun) is president of the ASP
Industry Consortium. 500 members in 1 yr.
Corio, Agilera, cMeRun, XeVo, Oracle, Breakaway are some of the companies on the
panel.
- There is a shortage of skill
out there
- issue: most software was not
designed to be hosted (multi-tenant, scaleable)
- Another panelist says that the requirement is 10 times faster, 10 times
cheaper, 10 times more reliable.
- he likes the fleet of model
T cars analogy. Be sure that the only color is black.
Otherwise, IT outsourcing has no economic advantage. we
must get rid of highly customizable apps. (my editorial
comment: wow!!, using the car analogy, he would hate custom cars)
- Pricing per user per month? or per year? usage based would be later
(e.g., charge per use for an
expense account)
- Consumer: games & educational software...
- 90% of the people can't handle
the complicated Windows desktop environment.
- Editorial note: the one
panelist seemed to be a throwback to the old Bell System. Black
Phones before carter phone. The customer can't handle anything complicated.
The company knows best.
- Some customers still want customization. 80% base w/20% customized.
- Applications renting is a
commodity business.
- Trust factor? Renting apps? metering? Settlement not built in... not
enabled yet. (How does a video company know that game was popular)
- 75% of customers come in from
the web... many ISPs are bad
- Internet appliance - Network Computing (Palms, Sprint Phone)
5-24-2000 Wed. 2:50pm
Sprint's Arthur
Chaykin, VP Strategic Development talked about "The e-Telco: not just a
dumb pipe"
- Carriers in the new economy: poor
telcos, dot coms are younger, smarter, hungrier, & will eat your lunch
- ASP Biz: Part of long term tension between resident & networked
(centralized) competency
- Local agriculture + railroads + increased efficiency
- Local crafts + modern transport + efficiency = industrial revolution
- Applications know how + next-gen telecom networks
- For every trend, there is a counter trend
- Local IT manager will not become a relic
- Voice mail & call notes vs. answering machine
- Life cycle of Apps:
- Discovery .. often localized
- Refinement.. some ASPeration
- Commodization...embedded in other apps...more prone to ASPeration
- Except complex apps
- Telcos have developing next-gen
networks that make the ASP business possible:
- High capacity fiber
& reliable SONET.. a prereq for ASP
- ATM allows deliver of multiple protocols over a single network
- Service delivery history key competency .....5-nines
- Telcos experience in
delivering services
- Network Centric View (Datacenter)
- ASP: Different Apps... categories (segmentation) (e.g., complex app-
multiple services or other complexities)
- Sprint has lowest level of outages (FCC) Fidelity uses Sprint for $1B
transactions/min
- Voice apps have always been
network hosted
- Sprint is an ASP (e.g., voice messaging)
Q&A: Since Sprint is one of Lucent's biggest IN customers, I thought that
it would be interesting to ask the speaker how he felt IN fit into his vision.
Someone else beat me to the punch. I'm glad he did. The speaker tried to be
polite, but obviously felt that IN was a completely different topic. He said
"AIN? I don't know". Maybe a new signaling system (or SS7) could be
used to confer with apps.
5-25-2000 Thurs. 9:05am
John Davis (Davies) VP Intel
- US econ $10T today.... e-Commerce $1T today
- 1980: Old computer industry. 6-7 worldwide suppliers $80B
revenues
- 1998: new computer industry (PC) hdw, mw, os, apps..... $800B
- 2012: Internet (telecom, networking, platforms, service)..... $8T
- 400K employees get a free PC w/internet access
- Mobile vs. fixed ...... task worker vs knowledge worker
- Web enabled cell phones (0-600M in a few yrs)
- Video tape from Sweden: Sweden is most advanced "If you don't have a
phone, you have no friends" Stockholm Nokia Packet GSM (GPRS?)
- Intel showed a demo, rack mounted stuff. XML
accelerator. "front end of ISP" $170K, WinNT, Compaq, Mircosoft
SQL7 has double the performance of the $430K Sun (sparc?) oracle
system 3000 vs 1500. http://www.intel.com/isp
5-25-2000 Thurs. 10:05am
Inktomi.
- Internet Infrastructure does matter. (behind the plug in the wall) Started
100 yrs ago with the telephone.
- 10 yrs ago we had the 386 ----> now we have the power of 400 SUN ultra
IIs to do a search engine.
- Phones 94% penetration in 100 yrs...(20 yrs for www)
- took 39 yrs to build phone
infrastructure (15,000 men coast-to-coast.... 5 men/mile)
- Internet breaks down buracracy .. democratization (e.g., ebay reviews)
- More services with fewer people
- Are you a new company? just do
your "core competency".. outsource everything else.
- Yahoo out sources search engine to inktomi... inktomi outsources
datacenter to exodus... exodus outsources datastorage to SUN...
- Network cache (52% Inktomi) is big. Content distribution network
distributes ("the Lion King") to the edge of the network for
Disney. Edge services is where the money is made. Internet architecture is
now done on the enterprise side of the firewall.
- "It's not about software,
its about services"
- Service Idea: Wireless... Germany parking garages (where is the
nearest empty parking spot?)....
- Nearest location? make sure river is not in the way.
- dislocate, don't be dislocated.
5-25-2000 Thurs. 11:30am Microsoft Only Session
Windows 2000. How to manage a server farm
- Policy: Group policy on all servers in a domain.
- e.g., dell.com use Windows boxes to set them. can log
into servers over the net. see desktop in a window (e.g. security
policy)
- 50% of servers are windows servers
Exhibits
- The show floor was 60% ISPCON, 20% ASPCON, 20% CLEC Expo.
- Like most shows, many exhibitors could have been at a general telephony
show such as Supercomm. Their products didn't seem to be specific to the ASP
market.
- I have a few handouts from the show floor.
- Large exhibitors were in the from of the hall. About 6 of them with
similar sized ISPCON booths: Lucent, Intel, Mircosoft, Cisco, SUN, were some
of the bigger booths. Lucent's
booth was slightly bigger than the others. Lucent had 8 areas:
- OneVision Product Family
- One Vision IP Configurator
- OneVision Network Fault Management
- Netminder System Packet Traffic Management (PTM)
- WaveStar Data Express 10G
- ORiNOCO
- VitalSuite
- Web Cacheing Solutions: IPWorX
- Acess Networks
- ProfitSuites
- DSL
- Novis Access
- Multi-Voice
- Remote Access
- SouthNet
- Kenan Internet Suite
- EXS Exchange Plus
- Virtual Private Networks
- SuperPipe 155 and Pipeline 85
- Lucent Managed Firewall
- VPN Gateway 80 and 201
- Router-Based VPN solutions
- Note: Lucent NetworkCare was displayed at the Mircosoft booth