Asp editor

One size does not fit all with ASP - Letters to the editor - Letter to the Editor

Telia's big test

In response to the recent story, "Telia wholesale shifts towards corporates" (CWI, 26 November 2001, P. 4), Telia's complaints in the current market are of their own decree. I worked at Telia UK for five years between 1994 and 1999 and am well aware of its history.

While all of Telia's competitors--WorldCom, COLT, etc.--made inroads to the enterprise/corporate markets during the mid-1990s, lack of investment by Telia AB in Telia UK resulted in the company being stranded way behind the competition at a very early stage. So marked was the lack of investment, and belief, that Telia Denmark was three times the size of Telia UK while being three years younger!

The result of indecisive policy at senior level and a misguided notion to join the over-subscribed carriers' carrier club has been disappointing results for their carrier division.

If Telia had concentrated on the enterprise/corporate markets and built the internal unit of people required to deliver the revenue, today, results would have been noticeably improved. Indeed, as Erik Heilborn says, concentrating on this area has already shown an increase of 37% in revenues.

The idea that an operator can reinvent itself to cope with economic uncertainty is not a completely unviable proposition but a major leap--no prizes for guessing what strategy other competitors are adopting.

Alexander Pulley, London

I liked your Telia article. The only mistake I found is that you refer to Telia International Carrier as "TIC" instead of "Telia" or "Telia IC." TIC? There is no such company.

Michael Szustak, Marketing Director, Telia International Carrier, Warsaw

ASP models

Your article on the ASP market (CWI, 22 October 2001, p. 24) discussed the collaboration between operators and vendors and stated that telcos are beginning to form partnerships with ASPs.

I agree with your comment that some carriers still have doubts about the ASP model, as they should. But for applications such as analytical customer relationship management (CRM), an outsourced model is better suited to deliver information to business managers in a timely manner.

Many firms are concerned that outsourcing CRM will result in losing sight of the customer as it requires a third party who may know little about your business. This does not have to be the case, especially if the service provider offers a consultancy-based service that works directly with the relevant teams in your company. Even if they never have any contact with your customer base, they can help you understand customer behavior.

Doubts can also arise due to the fact that many firms buy into a service that claims to cater for every business with one solution. For a CRM-based service provider to be successful, the service needs to be flexible enough to be tailored to individual customer requirements. As carriers look to develop partnerships with pure and hybrid ASPs, they need to consider the services of specialist providers, rather than partnering with larger software providers who follow the ambitious and unrealistic "one size fits all" model.

The observation that "targeting SMEs first was the wrong way to generate growth in this market," rang true. When the ASP model was first developed, many believed the ideal customer would be the SME as it was such companies that could not afford to invest in proprietary technology. I have held for over three years that this is wrong and the market has proved this to be so.

The benefits of the ASP model have always been attractive on paper. But IDC states that ASP services still represent only about 1% of the overall IT services market. As the market has grown, key players have been able to prove that such a strategy can bring clear financial and operational benefits by offering a reliable, fast and intuitive service.

John K Thompson, vice president worldwide marketing, WhiteCross Systems, Chicago