July 2000

Who Wants To Be A Telephony ASP?

BY RICH TEHRANI

This difference aside, becoming an ASP very much resembles a chase for prize money. Consider how the big prize is approached by contestants on "Who Wants To Be A Millionaire." They answer the easy questions first, and then they confront increasingly difficult questions as they proceed. The same happens with budding ASPs.

We'll take a look at some of the key questions that budding ASPs need to answer. Also, along the way, we'll cite examples of successful ASP models. In so doing, we hope to help those of you thinking of becoming ASPs (telephony or otherwise) break into the market.

But first, let's examine why any company would be interested in buying services from an ASP. There are many reasons that come to mind. A company might opt for an ASP so that it could concentrate on core competencies and sharpen its business focus. Also, a company interested in rapid growth might like to avoid getting bogged down in hardware purchasing and upgrade decisions. Such a company might like to outsource its hardware decisions to an ASP, avoiding the possibility of having to bet the farm on any single architecture. Finally, a company might opt for an ASP-based solution as a way of rolling out new applications and services more quickly.

READY TO PLAY?
Now that we've sketched the rationale for ASP-based solutions, let's get started...

Outsourcing For The Outsourcer
(The $100 Question)
To get started at the base level as an ASP, you need to decide on a hardware platform. Of course, as an ASP you are aware of the benefits of outsourcing. Accordingly, you may decide to have another company host your servers for you. (Focusing on a core competency is something that even ASPs need to worry about.)

This type of outsourcing works best if your service is Internet-based and needs little or no telephony. Some companies to consider when you are looking to outsource your Internet content delivery are Exodus Communications, Akamai, and Equinix.

Take Control Of Your Hardware
(The $200 Question)
Perhaps you are a control freak and can't stand the thought of having your servers in someone else's "farm." I am a control freak myself, so I can sympathize with you if you fit this description. In this case, your server solution is a bit more complex but easily manageable. (We are, after all, only on the $200 question.)

Many companies are targeting the ASP server space. High on the list are Sun, Hewlett-Packard, Dell, IBM, and others. What I find interesting is that many of the industrial computer companies you read about in this publication are also getting into the act as well. Many of these companies have been successfully providing fault-tolerant servers to the telecom industry for years, and the ASP market should be an easy lateral move for them.

One such company, Silconrax-Sliger, has already set their sights on the ASP market. The company has developed Starion, which the company refers to as a rack of virtual Web hosting appliances. Using management software, an ASP is able to manage software installations and upgrades, turn accounts on or off, and allow customers to configure their own allocations.

Billing (The $32,000 Question)
Those of you astute enough to notice have seen the $200 question jump to a full $32,000. But before you shoot off a nasty e-mail questioning my powers of addition, I want you to know that I am purposely increasing the value of billing as it is critical to the success of any service provider.

The ASP market is relatively new, but I doubt it will be long before all of the ISP and Internet telephony billing companies start playing in this space. Look to companies such as Daleen Technologies, Integretel, and Solect to provide you with the solutions you are looking for.

The Communications Angle (For $64,000, Is That Your Final Answer?)
You may decide to take the telephony route, that is, to become a telephony ASP, or TASP. And why shouldn't you? The telecom market is white hot, and there is enough opportunity to go around for all. Consider using DSP resource boards from companies such as Brooktrout, Natural MicroSystems, Dialogic, and Aculab.

You will probably have to collocate in existing POPs. If so, you may consider partnering with the likes of Qwest or WorldCom.

CRM (The Million-Dollar Question)
Notice another jump in winnings? I thought so. I just discovered a company, named Athene Software, that will help service providers of all kinds increase profits by creating strong bonds with their customers. I spoke with several of the managers of this company, and was extremely impressed by what they had to say.

Apparently, I am not alone in my admiration for Athene. MSN (The Microsoft Network) recently adopted Athene's solutions with an eye towards differentiating itself in a crowded field of ISPs. Although it is a bit early to discuss widespread use of ASP CRM services since the market is so new, it is important to provide new customers in the ASP world with incredible service so that the market can enjoy the growth it deserves.

PRACTICE WITH THE HOME VERSION
If you do decide to take the plunge and become an ASP, congratulations. I hope this article helps you become successful and profitable. However, before you take the plunge, please be sure that you study all of your alternatives. Then, when you're ready to play for real, be sure you pick only the best and brightest to serve as your lifelines!

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Has it been a year already? We're already rapidly approaching the second annual Internet Telephony Conference and EXPO. This event, to be held October 46 at the Hotel Del Coronado in San Diego, CA, has got us absolutely pumped! Once again, the editors of this publication and engineers of TMC Labs have combined forces to create a unique, leading-edge conference program.

What's incredibly positive is how much the conference has changed from last year. Almost half of the conferences are brand-new. Clearly, such a dramatic change is testament to how far this market has come in just 12 months.

I wish I had space to list detailed descriptions of all the sessions, but I simply don't. Instead, I will just give a brief overview of the new service provider tracks (including ASP tracks) and developer/reseller tracks. Next month, I'll discuss the enterprise and general/special interest tracks. If you would like more information, please feel free to visit our Web site at www.itexpo.com. And remember, if you register by July 25, you will save over $300. Please register early because space at the world-renowned Hotel Del Coronado is extremely limited.

CONFERENCE SESSIONS FOR SERVICE PROVIDERS
The Evolution Of The Next-Gen Network
Learn how to assemble the myriad devices and protocols necessary to efficiently establish successful and worry-free IP telephony networks.

Send Your Packets First Class: Class 5 Switch Alternatives For The Network's Edge
The holy grail of the service provider market. Provide voice and data services more inexpensively and more flexibily than ever before.

Scaling The Internet: Network Architecture And Next-Gen Switching/Routing
Explore the new services, pricing models, and hardware and software solutions that are rapidly advancing the state-of-the-art in telecom.

How To Be A Perfect Host: ASPs And Opportunities In Outsourcing
The application service provider market is growing exponentially, and there seems to be no end in site. Explore the various options that can help make you become a successful ASP.

What Can A Power Line Do For VoIP?
Finally, some competition for the cable and DSL providers. Explore the technologies and opportunities in this new market.

Cable Telephony: Ready For Prime Time?
Cable modems, the most prevalent last-mile broadband device in the land, are positioned perfectly to transmit telephony and a world of new services. Discovery the opportunities that cable telephony presents.

Case Studies: The View From The Trenches
They say there is no substitute for experience, so we'll give you the next best thing. Finally, a way of interacting with those that have taken the plunge and deployed next-gen networks.

Broadband Wireless: Aerial Assault On The Last Mile
Learn the techniques and technologies that will help you learn how to implement broadband wireless solutions.

3COM Round Table: SIP And Interoperability
This session will expound upon the challenges and protocols that are involved with getting these disparate products working together.

CONFERENCE SESSIONS FOR DEVELOPERS
Developing Internet Telephony Applications For Windows 2000
Love it or hate it, Windows 2000 wants to be the predominate server OS of the future. Come learn the special features inherent in the OS that will allow you to write killer next-gen communications applications.

Standards Shootout
Nothing is worse than developing using yesterday's standards. It is essential to come to this session to make sure you are developing on the right platform.

Linux And Open Source Development
What better OS to write open IP telephony apps on? There are so many choices and so many opportunities. Come and delve into them.

Managing And Maintaining QoS In IP Networks
Once an insurmountable challenge, we are now at the point where QoS issues are effectively moot in the right hardware and software environment. We'll show you what the right environment consists of.

Funding Your Brainchild: From Blueprint To IPO
Learn to approach VCs and other sources of funding. Also, discover how the right partnering strategies can help you get started.

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In the April issue of this publication, I wrote an extensive column on Telera, a new ASP that redefines how companies are able to communicate with their customers. Since then, many other companies have established themselves as ASPs.

One such company, AccessLine Communications, is particularly interesting. AccessLine is a telephony ASP. The company offers a suite of services named VoiceEngines that can help companies handle many of their communications needs. Suite features include auto-attendant, call forwarding, conference calling, e-mail, voice mail, and fax. These features are offered in addition to a hosted PBX service. Taken together, these services allow corporations to replace or augment hardware that they may already rely on today.

I asked AccessLine if they had any examples of companies actually using their services. Of the companies they cited, the one I found most interesting was Adaptive Broadband. This company had decided to integrate its multiple divisions more closely, and it was were looking for a solution that would help them accomplish this task.

An extra twist: The company's sales people were being inundated by customer requests for technical support, customer service, and order tracking information. So, while it moved to consolidate its operation, Adaptive Broadband wanted to preserve the strong relationship it had with customers. Also, the company wanted to maximize the time salespeople spent selling.

Using the AccessLine's ASP model, Adaptive Broadband was able to provide each customer with their own 800 number and auto-attendant. The auto-attendant could be customized for each customer or group of customers. Now, when an existing customer called on their personal 800 number, they would hear a greeting such as this: "Hello. You have reached Bill Smith. Please press 1 for technical support, 2 for order tracking, 3 for customer service, and 4 for RFIs." In this manner, the Adaptive Broadband was able to cement existing customer relationships and increase the productivity of the sales department simultaneously.

I am told this application was rolled out in only two weeks. And, since it was a software solution, the application allowed Adaptive Broadband to avoid having to worry about product upgrades should the company decide to enhance the application's customized functionality.

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