NETWORK WORLD NEWSLETTER: JEB BOLDING
on APPLICATION SERVICE PROVIDERS
11/20/01 - Today's focus: Touched by an angel

Dear Wincenty Kaminski,

In this issue:

* BMC enters MSP market with GuardianAngel
* Links related to ASPs
* Featured reader resource

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Today's focus: Touched by an angel

By Jeb Bolding

BMC released its GuardianAngel managed service provider
offering at Comdex last week. While many managed service
providers (MSP) struggle, I think GuardianAngel just might
succeed.

One of my pet peeves about the ASP industry is the lack of
software solutions that offer network, systems, and application
management solutions to reveal ASP service levels for
customers.

Most ASPs monitor their systems in some fashion. However, they
rarely publicize that data out to their customers. If they do,
commonly that information comes from a homegrown set of tools
that report primarily on basic availability information about
the hosted applications or systems. This really isn't service
level management, though it may purport to be. In fact, the
availability and performance numbers that are pushed out to
customers through homegrown systems, are probably not all that
indicative of true service levels since the solutions are
designed by developers who are application experts at their
ASP, not systems management experts.

So why can't ASPs go out and buy a good management solution
that gives their customers a reasonable understanding of ASP
system performance?

I think there are three things that have inhibited ASPs from
making that investment.

First, and foremost, is cost. Most independent software vendors
create their management solutions from a sales perspective, to
be sold into the enterprise space where the purchasers pay a
steep up-front licensing cost and then a relatively minimal
support fee per year.

Since the vast majority of service providers have business
models that focus on regular monthly or quarterly payments,
they've had a hard time rationalizing their cash flow to
purchase a best of breed management product. I suppose that
this is the kind of purchase, one might argue, that those high
IPO valuations were supposed to cover 18 months ago. Nowadays,
spending $1.5 million on a management product (including
licensing, deployment, and customization) is out of the
question.

Another problem is integration. For most ASPs, there simply is
no management integration. Whatever applications or systems an
enterprise outsources to an ASP, those are treated as islands
of management technology, separate from the applications that
enterprises manage internally. Even if an ASP has a monitoring
and management product deployed, those solutions are not
designed architecturally to populate a central console with
event and data information, nor transmit information across a
wire to a database inside the corporate firewall.

Finally, traditional management solutions are designed to give
an IT administrator a centralized view of what's going on with
their enterprise systems. They're not designed to display
customer-centric data to multiple customers who are protected
from viewing the event and systems data of other customers.

To address many of these problems, MSPs have approached the ASP
market need with solutions that are priced based on a
subscription service, designed specifically for integrating
event and data information across a distributed network, and
developed with an interactive Web interface for customer and
administrator views.

However, MSPs, just like ASPs have had their own troubles and
lately there has been consolidation within the MSP ranks.

I admit that I've pondered why some of the systems management
companies have not offered MSP solutions themselves. It may be
culture that prevents them from addressing the needs of
extended enterprises and service providers. But with BMC, one
of the big management players, launching GuardianAngel, that
will hopefully, address many of the infrastructure management
needs that service providers have.

Most importantly, this service offering is supported by BMC, a
company with deep pockets and the ability to stay the MSP
course financially, unlike many of its smaller, more
specialized MSP brethren.

With the larger BMC corporation behind it, I think that
GuardianAngel can make a strong go of the MSP space.

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To contact Jeb Bolding:

Jeb Bolding is senior consultant with Enterprise Management
Associates in Boulder, Colo., an analyst and market research
firm focusing exclusively on enterprise management. Bolding has
10 years of experience in the network systems industry, most
recently with eCollege.com, an ASP for higher education, where
he was director of product development. He can be reached at
mailto:jbolding@enterprisemanagement.com.
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RELATED EDITORIAL LINKS

U.S. special forces to outsource net ops
Network World, 11/19/01
http://www.nwfusion.com/archive/2001/127511_11-19-2001.html

Outsourcing options on the rise
Network World, 11/19/01
http://www.nwfusion.com/news/2001/1119carrier.html

Breaking ASP news from Network World, updated daily:
http://www.nwfusion.com/topics/asp.html

Archive of the ASP newsletter:
http://www.nwfusion.com/newsletters/asp/index.html
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FEATURED READER RESOURCE

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Network World Fusion's The Edge is a resource devoted to the
advances in service-provider networks that are shaking up the
old telecom order. In classic Network World fashion, we focus
on the hardware, software and services coming to market - but
this time from the vendors targeting legacy carriers, new
alternative local carriers, ISPs and application service
providers. http://www.nwfusion.com/edge/index.html
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