Oracle adds more partners for ASP unit

The database software giant announced Monday a list of new partners to support Business Online, its application service provider (ASP) unit, which rents and hosts the company's business management software for corporate clients.

The company said the latest flagship members of its Business Online implementer initiative are system integrators AnswerThink, Arthur Andersen, Computer Sciences (CSC), Deloitte Consulting, Grant Thornton, KPMG, Millenia Vision, Parker Management Consultants, Solbourne, Solix Systems and Stonebridge Technologies. Oracle said it wants to provide customers with several options in addition to Oracle Consulting to help them rent applications.

Redwood Shores, Calif.-based Oracle also said communications providers Sprint and Genuity have joined the company's new network partner program that supports Business Online. The partners have agreed to offer Business Online customers a fixed price for their network connectivity services.

ASPs host software so businesses don't have to install and manage the applications themselves. People access the software over the Web, and it is typically monitored remotely from a data center. Customers pay outside providers to run everything from complicated enterprise software installations to more common desktop applications, which can also be difficult and time-consuming to maintain.

The move points to Oracle's intentions to broaden its once tightly held application hosting strategy.

When the company launched Business Online more than a year ago, chief executive Larry Ellison vowed it would not form partnerships for software rentals. Oracle had repeatedly said it would rent its business applications only via that application-hosting unit.

But earlier this year, the company slowly and quietly began picking up application hosting partners, beginning with Portera, an ASP that hosts Oracle's financials, human resources and purchasing software for a niche market. In July, Oracle did a 180-degree turn in strategy when it unveiled a slew of new ASP partners such as Center 7, BlueMeteor and Agilera.

Meanwhile, Oracle seems to be making progress in the ASP market, Hurwitz Group analyst Bill Martorelli said in a recent interview.

"Obviously, (Oracle) had challenges and went through transitions," he said, adding that most players in the market continue to have difficulty nabbing enough customers and are still fine-tuning their business models.

"(The ASP market) is not easy for everybody," said Martorelli.

Oracle rivals such as SAP and PeopleSoft have already teamed with pure-play ASPs such as Corio, USinternetworking and eOnline, in addition to setting up their own practices. Analysts had criticized Oracle's initial strategy because they believed it needed partners in the young market to increase the number of customers that sign up for the service.

Like a growing list of software makers, Oracle has been aggressive about offering its software as a service. The giant, which claims 100 companies are using Business Online, also recently launched OracleSalesOnline.com, a service that offers customers the company's core sales force automation software at no cost. Oracle charges fees for additional components such as sales compensation software based on a pay-per-use model.