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Commentary: Jamcracker's ASP vision

The company has had to recast itself with a more pragmatic vision: creating a product that enables other companies to manage their own ASP offerings.

    By Ben Pring, Gartner Analyst

    The market for application service providers has proven a hard nut to crack. Many vendors have had to rework their original ideas into strategies more suited to market conditions.

    Jamcracker always had an interesting vision; it was very sophisticated and based on a futuristic scenario. The company attempted to address a management challenge faced by customers purchasing solutions from multiple ASPs. It sought to ease the management burden, aggregating all of the disparate suppliers for the customer.

    See news story:
    Jamcracker reworks its software strategy
    Because the ASP market has developed more slowly than many vendors and industry analysts expected, Jamcracker's original vision hasn't really panned out. For the past six months to a year, therefore, the company has had to recast itself with a more pragmatic vision.

    That vision involves Jamcracker becoming less like the original ASPs (such as USinternetworking and Corio) and turning some of its management expertise into a product that enables other companies to manage their own ASP offerings. That product could also help software vendors that want to have ASP offerings.

    This approach marks a shift away from a focus on managing multiple ASPs independently to providing a software platform that independent software vendors (ISVs) can use. Gartner research shows that more and more ISVs want to offer hosted or ASP versions of their software. Jamcracker's move to offer such vendors management platforms is appropriate given the market trend.

    Jamcracker's new software may be relevant for businesses wanting to leverage their own applications in a hosted model. Hosted models are definitely in demand by mainstream information-technology customers. Therefore, management platforms will become more important in the future.

    Jamcracker is receiving an infusion of $28.4 million in funding for this endeavor, and that is unusual in the ASP market. Jamcracker's chief executive, K.B. Chandrasekhar, obviously holds some clout and he must be quite convincing when he presents his company's new vision.

    (For a related commentary on the ASP market, see gartner.com.)

    Entire contents, Copyright © 2002 Gartner, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.