More than 60 per cent of ASPs currently operating in Australia will have disappeared by the end of next year, Gartner research director Rolf Jester has predicted.
Jester estimated at a press briefing yesterday that two ASPs (application service providers) were launched every single day, either as startups or as existing technology companies simply reinventing their product offerings.
However, he said poor business management, insufficiently skilled staff and haphazard partnering attempts will see an ASP market consolidation by the end of 2001.
Gartner predicts that the ASP market in the Asia-Pacific region, which it says is growing at 106 per cent year by year, will pip the $US2.5 billion ($4.18 billion) mark in five years, representing the largest single ASP market in the world. Jester pointed out, however, that few local ASPs were able to show evidence of a considerable customer base yet.
Jester warned industry spectators to expect a "trough of disillusionment" to soon follow the current "peak of inflated expectations" experienced by the market.
In 2004 networking service providers will struggle to meet the service level expectations of customers, Jester forewarned.
Gartner also announced yesterday that it has officially changed its operating name from GartnerGroup.