Application Service Provider

Definition of Application Service Provider

An Application Service Provider (ASP) is a company that offers individuals and businesses access to applications and related services over the internet. Generally, ASPs manage and maintain the software, while users access the applications remotely through an internet connection. This model allows businesses to save on the costs associated with purchasing, installing, and maintaining complex software applications on their own infrastructure.


The phonetics of the keyword “Application Service Provider” in the International Phonetic Alphabet (IPA) are:/ˌæplɪˈkeɪʃən ˈsɜrvɪs prəˈvaɪdər/

Key Takeaways

  1. Application Service Providers (ASPs) host and manage software applications on remote servers, enabling users to access them via the internet on a subscription or pay-as-you-go basis.
  2. ASPs help businesses reduce the cost of software ownership, maintenance, and infrastructure by providing scalable services, making it economical for organizations of all sizes.
  3. By using an ASP, businesses can focus on their core competencies and maintain a secure, up-to-date software environment without the need for extensive in-house IT resources and expertise.

Importance of Application Service Provider

The term Application Service Provider (ASP) is important because it refers to a business model that offers organizations a cost-effective, flexible, and scalable way to access and use software applications over the internet.

By utilizing this model, companies can focus on their core competencies while leveraging the expertise of ASPs for managing and maintaining software applications.

This not only reduces upfront investment costs, but also minimizes ongoing expenses such as maintenance, upgrades, and support.

Moreover, ASPs allow for greater accessibility and ease of use, enabling companies to stay competitive in an increasingly technology-driven landscape.

Overall, Application Service Providers play a vital role in enabling organizations to harness the power of modern technology without shouldering the burden of managing software applications themselves.


Application Service Providers (ASPs) have emerged as an essential component in the business landscape, catering to the rapidly growing demand for software solutions and IT services. The purpose of an ASP is to deliver and manage these services, offering organizations a way to access software applications and dedicated servers without the need for costly investments in hardware, software management, and technical personnel. Businesses benefit from the ASP model as it allows them to focus on their core competencies while outsourcing IT operations to an expert third-party provider.

Moreover, this model helps companies achieve greater scalability, flexibility, and operational efficiency. The ASP model is highly versatile and serves an array of use cases. From enterprise-level applications such as Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) to specialized software solutions focusing on e-commerce, project management, and human resources, ASPs can cater to a wide range of business requirements.

Furthermore, these service providers typically offer additional services like data management, backup, security, and software upgrades. By leveraging an ASP’s services, organizations are able to access the latest software and features – all delivered through the internet – without the burden of purchasing, maintaining, and updating their IT infrastructure. This cost-effective approach allows businesses to remain competitive and agile within an ever-evolving technology landscape.

Examples of Application Service Provider

Salesforce: Established in 1999, Salesforce is one of the leading cloud-based Application Service Providers in the world. Salesforce provides enterprise-level applications, primarily for Customer Relationship Management (CRM), accessible to organizations of all sizes, from small businesses to large enterprises. Companies can use their services through subscription-based pricing, without having to worry about developing and maintaining the software and infrastructure needed for CRM.

Google Workspace (formerly G Suite): Google Workspace is a suite of cloud-based productivity and collaboration tools provided by Google. As an Application Service Provider, Google offers a wide range of applications such as Gmail, Google Drive, Google Docs, and Google Meet. These services are available to businesses and individuals alike who can subscribe to access the tools without having to manage the underlying infrastructure. This enables users to work and collaborate virtually from any device with an internet connection.

Microsoft Azure: Microsoft Azure is a comprehensive cloud computing platform that provides various cloud-based services and solutions, acting as an Application Service Provider for businesses and developers. Azure offers a range of services, including virtual machines, storage options, databases, and even platform-as-a-service (PaaS) and software-as-a-service (SaaS) solutions. Companies can build, deploy, and manage their applications and services using Azure’s extensive resources, without having to maintain their infrastructure.


Application Service Provider FAQs

What is an Application Service Provider (ASP)?

An Application Service Provider (ASP) is a business that provides software applications to customers over the internet. Customers access these applications remotely, typically through a web browser, without the need to install or maintain the software on their own systems.

Why use an Application Service Provider instead of traditional software?

Using an ASP offers several advantages over traditional software, including reduced costs, easy access, automatic updates, and scalability. The primary benefit is that customers can access applications from anywhere with an internet connection, without the need to purchase and maintain expensive hardware or infrastructure.

What are the typical services offered by ASPs?

ASPs typically offer various software applications related to different industries, such as customer relationship management (CRM), human resources management, enterprise resource planning (ERP), and content management systems (CMS). Furthermore, ASPs can offer customizable solutions and support services, such as data backup, security management, and system maintenance.

How secure are Application Service Providers?

ASPs invest significantly in security measures to protect their customers’ data and ensure the privacy of their customers. The security features provided by an ASP may include encryption, firewalls, intrusion detection, and secure data centers with restricted access. However, it’s essential to evaluate each provider’s security measures and policies when selecting an ASP for your business needs.

Are Application Service Providers the same as cloud providers?

Application Service Providers and cloud providers are similar but not the same. While both provide software and applications through the internet, ASPs tend to focus on providing specific applications while cloud providers deliver a broader range of services, such as storage, infrastructure, and platforms, in addition to applications. Additionally, cloud providers typically operate on a subscription-based pricing model, while ASP pricing can vary depending on the provider and services offered.


Related Technology Terms

  • Cloud Computing
  • Software as a Service (SaaS)
  • Remote Application Hosting
  • Managed Service Provider (MSP)
  • API (Application Programming Interface) Integration

Sources for More Information


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