Exploring the supply-side of IT outsourcing: evaluating the emerging role of application service providers

Abstract

The paper explores the supply-side of IT outsourcing by focusing upon the emerging role of application service providers (ASPs). It traces the transition from first wave IT outsourcing in the 1960s, to business-centric outsourcing in the 1980s and 90s to application outsourcing in the 21st century. Drawing from empirical research on a taxonomy of ASPs, the paper explores how application outsourcing is currently changing the nature of the outsourcing contract and relationship between client and supplier. This will have significant implications for traditional outsourcing and ERP vendors in the software and computing services industry, in addition to presenting new opportunities to SMEs with little history or experience of outsourcing.