EarthLink Will Try ASP Plans Again

An executive's departure and the staggering economy conspired to keep EarthLink Inc. from realizing its ASP plans last year.

An executives departure and the staggering economy conspired to keep EarthLink Inc. from realizing its ASP plans last year.

But the ISP (Internet service provider), looking to expand business, said it expects to begin this spring trials of selling hosted applications to its small-business broadband customers.

The Atlanta-based ISP, which first outlined its application service provider plans in August 2000, planned its trials for last summer. However, Ed Douglas, an executive running the project, left the company, and as the economy soured, resources were moved from the project into EarthLinks broadband sales effort, said Michael Ihde, vice president of nationwide business sales.

"Its not so much that it was canceled," Ihde said. "Its still right there in the forefront. I am hoping that this gets rolled out in April or May of this year."

Internet access accounts for 95 percent of EarthLinks revenue, Ihde said.

Helen Chan, an analyst with The Yankee Group Inc., said that EarthLink is on track but must proceed with caution.

"They know the type of product that they need to grow, and they know what their constrictions are," said Chan, in Boston. "[But] the business division will always be secondary, so they have their hands sort of tied behind their back."

In addition, selling hosted applications to small-business customers could be a tough move because of the companys consumer orientation, Chan said.

Of the seven Web hosting companies and ASPs EarthLink had considered partnering with, only two are still in business, Ihde said. One of them is Verio Inc., an Englewood, Colo., subsidiary of NTT Communications Corp., in Tokyo.

"We had discussions with them in one form or another" about 12 to 15 months ago, but those talks may soon be renewed, Ihde said.

The other company EarthLink is considering as a partner is a large services company, not a traditional ASP, said Ihde, declining to name the company.

EarthLink officials are no longer considering the part of their original plan to offer consumer ASP options. With the rise of Web services, such as Microsoft Corp.s .Net initiative, "I would think wed be out of the ballpark if we did that," Idhe said.

However, the original plan did include tools, including those for sales force automation and customer relationship management for small businesses.