Tequinox targets ASP market

Tequinox targets ASP market

Recently renamed services company Tequinox met ASP critics head-on last week after launching its new name and claiming that the ASP business model will fly faster than the pundits predict.

Bill Hodgson, Tequinox's executive vice president, has responded to industry claims that customers will be slow to use ASP services by predicting widespread adoption will occur within 12 months.

`I believe the take-up will be significantly faster than people think,' he said.

The reason, Hodgson claims, is that end users now drive the business model instead of vendors and venture capitalists.

One recent ASP detractor is John Connors, vice president of Microsoft's worldwide enterprise group, who told ARN recently the ASP principle is `more complicated than it appears on the surface.

`A lot of US venture capitalists are putting money into it,' Connors said last week (ARN, November 17, page 28).

`But technology that's good in-house may not be so good when it's hosted. It's quite a simplistic approach to think they [users] can click on a browser and it's all there.'

According to Hodgson, Tequinox has offered variations of the hardware/software rental model for around five years under its former guise as Mincom IT Services, an arm of EAM software developer Mincom.

In fact, he reports Tequinox is already generating between $5 million and $7 million in revenues directly from its ASP business. The business as a whole has annual revenues in the vicinity of $30 million.

By comparison, he said Tequinox dwarfs Solution 6's much-hyped ASP business. `I doubt if they are doing a tenth of what we do [in revenues].'

The most significant trend to emerge from his business is the move away from the traditional reseller model. `We've moved from being a reseller to a customer.'

Under Tequinox's plan, it will purchase all the equipment it needs to run its ASP Centre and run its customers' business, commenting that it will not get much change from $10 million to build the centre.

The company is currently planning to establish one ASP Centre in Australia and one in North America, where Mincom also has a rapidly growing business, Hodgson said.

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