ASP DEVELOPMENT: A FAST TRACK TO THE WEB.

Remotely-hosted rental software is the hot new business model these days, but the earliest ASP-style rental applications almost certainly won't be written with Microsoft tools. At Microsoft's Professional Developers Conference in Orlando earlier this month, attendees got an enticing preview of Microsoft's .Net strategy--and also heard that VisualStudio.Net, the basic tool for creating these new applications, won't be finished until sometime next year.

Instead, a little Silicon Valley startup called New Moon now looks like the front-runner for turning existing Windows products into rental and trialware applications. New Moon has been quietly working on conversion tools since 1995, and the company now claims that it can take "out-of- the-box" code and produce a complete remotely-hosted version in less than a month.

Despite a few rough edges, moreover, New Moon's conversion tools are beginning to attract serious attention from commercial developers (including Autodesk, Sybase, and Novell), who seem to like what they see. The venture community also sees New Moon as a good bet: An investment consortium led by Softbank just handed the company $35 million to scale up for a likely stampede of would-be ASP developers.

Tools companies don't usually attract this level of investment, but New Moon is itself more of a service business than a product company. In fact, New Moon doesn't sell software at all. Instead, it charges fees for conversion and hosting services that are designed to generate revenue across the whole software rental cycle. In the New Moon model, developers will pay the company an up-front fee to ASP-enable their Windows products, and will then outsource the hosting and administration of their ASP business (even including end-user billing, if requested) to New Moon.

As it happens, this kind of one-stop-shopping solution makes sense for many developers who are testing the ASP waters these days. Turning a Windows product into an ASP service requires more than rewriting a few lines of code; there are also knotty problems of server administration, user authentication, usage metering, load balancing, and data security, all of which New Moon solves as part of its basic hosting package. And unless the price for these services is unreasonably high, we suspect most developers will be perfectly happy to park their rental and trialware applications on New Moon's servers pretty much forever.

Of course, the New Moon model does have a few limitations. New Moon primarily addresses the problem of creating high-performance conversions of existing Windows code, which is probably not the best approach for developing true Web-centric applications and next- generation Web services. Over the long haul, New Moon will have to give developers product design and creation tools (which will inevitably compete head-to-head with VisualStudio.Net and other Microsoft developer tools) or else run the risk that its data centers will end up hosting nothing but old-style Windows ports.

But that problem is still a long way off. For now, code conversion and hosting are the real bottlenecks in the ASP market. And so far New Moon looks like it has a fast-track solution for both of these problems.

New Moon Systems, Two North Second St., San Jose, Calif. 95113; 408/296-8500. Web: www.newmoon.com.