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What is Application Service Provider (ASP) ?

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  • Last Updated : 22 Jun, 2021
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Application Service Provider :
It is a third-party unit which provides access to software applications and other services to individuals, multiple customers or organizations to meet their requirements through Internet. Multiple users and organizations access the service over the network based on pay per use or temporary contacts. On behalf of the customers, it deploys and manages application software, system hardware and networking at a centralized facility manner. It is also a very promising technology which gives cost-effective, competitive information technology.

ASP in current market :
Starting from small to medium and medium to large organizations, every organization are using ASP depending on their requirement and service choice. ASP acts as an important alternative to use required software for most of the small and medium businesses who run their organizations with low and limited budgeted IT infrastructure. But many large organizations also face budget outsourcing problem due to this ASP cost of charge There are several types of application service providers available, i.e. Specialist, Vertical market, Enterprise, Local/Regional, volume.

  1. Many smaller organizations use applications on a pay as per use.
  2. Many large organizations commit to ongoing contracts.

Types of Application Service Provider :
Application Service Providers can be breaking down into five subcategories i.e.

  1. Enterprise Application Service Providers –
    They deliver high-end business applications.
  2. Local/Regional Application Service Providers –
    They supply wide variety of application services for smaller organization in a local area.
  3. Specialist Application Service Providers –
    They provide applications for a specific need, for human resources or Web services.
  4. Vertical Market Application Service Providers –
    They provide support to a specific industries like health care.
  5. Volume Business Application Service Providers –
    They provide supply of application services in volume to small/medium businesses.

ASP advantages :

  • Back end of the application is already up and running faster.
  • Faster deployment is possible.
  • Software usability and reliability.
  • It can also track and push software upgrades, without interference customers.
  • It can handle much of the work of IT workers.
  • Customers also could shift costs from capital to operating expenditures for accounting reasons.

ASP disadvantages :

  • Security risk is a major concern for the organizations using virtual servers.
  • Lack of integration in between customer software and ASP software.
  • Sometimes, customer’s have to pay high cost for it.
  • Lacks ability to customize the software applications.
  • Poor network sometimes affect the service availability rate.


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