What Happens When ASPs Fail?

from the oops.--no-more-software dept

Some companies are suddenly (and painfully) discovering the downside of the ASP model. If they rent their software (which is hosted elsewhere) and the ASP they’re renting from goes out of business, suddenly, all their software may be gone. That’s just what happened to some customers of Red Gorilla, who are now pretty pissed off. At the very least, a company going out of business should have to give enough lead time to allow companies to migrate to a different system. However, I think this may show up as one more reason why ASPs have trouble really catching on, long term.

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Comments on “What Happens When ASPs Fail?”

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Ed says:


It was (is?) common practice, if your business depended on proprietary software, to insist that the software developer have a source code escrow agreement so that, in the event that they went out of business, you’d be able to get some kind of support, probably paying through the nose for it, but that’s still better than being left with no options at all. Seems like ASP’s will need to offer similar reassurances, and it also seems like being an ASP escrow service is a business opportunity for someone.

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