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USWeb adds service offering

On the heels of its upbeat earnings report, the services firm unveils a new offering that mixes outsourcing apps with consulting.

On the heels of today's upbeat earnings report, professional services firm USWeb unveiled a new offering for outsourcing corporate applications.

USWeb Electronic Services aims to use the Internet so that proprietary or packaged business applications can be hosted by the customer or by USWeb--or moved back and forth depending on the season. A retail store might run its own storefront most of the year but let USWeb host it during the holiday shopping season, for example.

USWeb is joining a wave of ISPs, hosting services, and even software companies such as Oracle that are hosting applications for customers, but USWeb brings a force of 1,200-plus consultants that few other vendors can match.

"This level of flexibility is new in the marketplace," said Richard Brewer, senior analyst at International Data Corporation, noting that demand is strong.

"Whether it's e-commerce or messaging or some other Internet-based enterprise application, our research shows people are looking for help from external providers," Brewer said. Many companies can't staff up adequately to manage big applications, so they turn to outsourcers.

"This is not just application outsourcing, but an IT superstructure that runs commercial or customer applications," said USWeb president Tobey Corey. "It is a strategic move into this space. We view it as the future of IT. We expect more companies to enter in coming months."

USWeb today announced a new Electronic Services division that has been split out of its professional services organization and more than two dozen of its customers.

Harley-Davidson is one customer. USWeb created an application for the firm's warranty claims, linked to its legacy systems, and now hosts the applications and manages warranty claims. It also will market the warranty claims application to other manufacturers.

Corey views the market with three kinds of competitors: Phone carriers and Web hosting firms, application providers such as Oracle and Commerce One that host their own apps for customers, and classic services firms such as IBM or Hewlett-Packard.

USWeb hosting services will cover applications in four areas: email and streaming media, e-commerce transactions and personalization, customer care and sales force automation, and back-office functions such as human resources or value chain management.

It also named Cisco Systems and Microsoft's Windows NT 5.0 as its preferred platforms, although it also hosts Solaris and other Unix applications. It also will partner with application vendors BroadVision and Vantive.