ASPects: March 19, 2001

Expanets Buys Hosting — and So Much More

In what may be the largest deal to date in the application service provider business, network communications provider Expanets has signed a $22 million, five-year contract with Qwest Cyber.Solutions. According to the agreement, QCS will host Oracle Enterprise Resource Planning and Siebel Systems customer resource management applications for Expanets. The product of more than two dozen acquisitions in the last three years, Expanets is a natural candidate for a centralized hosted application strategy that can support more than 3,500 users at more than 130 locations across the country. "The driving factor was really the challenge of integrating acquisitions and putting in enterprisewide solutions," says Ernie DeNegris, chief information officer at Expanets. "Its a rather large and difficult program." QCS will host the applications and manage them through the operating system level, with Expanets managing them at the application level. "Our relationship with QCS is more than hosting — it has some qualities of an ASP relationship in terms of services and support," DeNegris says. "We also see in them a range of future possibilities, and a potential for expanding the relationship." DeNegris expects the hosted services to start rolling out later this year.

Counting Heads

Jamcracker has terminated 18 jobs, but dont call it a layoff, the application services aggregator says. Despite some angry, anonymous e-mail that came my way and makes use of the L-word, a Jamcracker source maintains that the lost jobs were the result of a restructuring — not a retrenchment — and that the company is still hiring. Jamcracker, which has raised more than $150 million to date, expects to announce what the source calls "significant" additional funding in the months ahead.