A Market Segmentation Strategy for Developing an ASP Business

It is argued that the ASP industry is highly dependent upon strategic alliances between infrastructure companies, independent software vendors, telco’s and others, and will need to develop a market segmentation strategy to ensure their survival.

Abstract

This paper focuses upon the emerging application service provider (ASP) industry. A large research programme funded by the European Union, Engineering and Physical Sciences Research Council, the Economic and Social Sciences Research Council, and the Department of Trade and Industry (DTI), involving industrial collaborators from technology providers, ASP solutions providers to expert users. The paper argues that the ASP industry is highly dependent upon strategic alliances between infrastructure companies, independent software vendors, telco's and others. Focusing upon the different types of ASP business models, the paper suggests that ASPs will need to develop a market segmentation strategy to ensure their survival.