'When do you ASP?' The Software Life Cycle Control Model

Application Service Providers (ASPs) now offer a new alternative for the acquisition and operation of application software, enabling companies to rent or lease applications that are delivered via the Internet. In determining the appropriateness of this strategy, companies must tradeoff the cost and...

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Journal Title: Information Systems Frontiers Vol. 5; no. 2; pp. 219 - 232
Authors: M.A. Serva, S.A. Sherer, Janice Sipior
Format: Article
Published: Apr 2003
Online Access: Full Text
Summary: Application Service Providers (ASPs) now offer a new alternative for the acquisition and operation of application software, enabling companies to rent or lease applications that are delivered via the Internet. In determining the appropriateness of this strategy, companies must tradeoff the cost and time advantages of this approach with its risks. This paper introduces a Software Life Cycle Control Model that describes the dimensions of control over software features and operations associated with various software acquisition strategies, including internal development and operation, purchasing packaged applications, outsourcing, and ASPs. Transaction cost economics (TCE) is used to identify the key costs and risks that must be considered in the software acquisition decision. We propose when ASPs may be appropriate for companies with existing IT infrastructure and companies lacking infrastructure to develop and operate new applications.
ISSN: 1387-3326
DOI: 10.1023/A:1022613925874