FutureLink scores $10 million investment from Microsoft

The investment is the software giant's latest in an application service provider and involves plans for a joint research lab and two hosted application labs.

Application service provider FutureLink today said it garnered a $10 million investment from software giant Microsoft.

As part of the deal, FutureLink, which hosts business applications for corporate customers so they don't have to manage the software themselves, plans to develop a joint research lab with Microsoft. The two companies also said they intend to create two hosted application labs for software developers who want to provide hosted versions of their applications using Windows 2000 Terminal Services.

FutureLink competes in the growing application service provider, or ASP, market against rivals Corio, USinternetworking, Interpath and a host of others. FutureLink stores software and other applications in a data center and rents them to companies on a per-month, per-user basis. Such services allow companies to call up applications over the Internet rather than host and manage them on their own corporate networks.

Today's deal builds on FutureLink's existing relationship with Microsoft that began last November when FutureLink became a partner of the hosted application initiative set up by Microsoft and Cisco Systems. FutureLink also hosts business applications for customers on Microsoft's Windows 2000 server.

In January, Microsoft invested $10 million in FutureLink competitor Corio and detailed similar joint research and development plans. Microsoft has also made a $67.5 million investment in application hosting provider USWeb/CKS, now known as MarchFirst. The software giant is currently funding the development and marketing of new application services and technologies for the companies' joint customers.