IEC REPORT OUTLINES FUTURE OF WAN OUTSOURCING AND ASP OPPORTUNITIES.

Providers of WAN management outsourcing services who offer applications services -- including Web-based applications, shared mainframe software, e-commerce, and conferencing -- are poised to assume market leadership, according to a new research report by the International Engineering Consortium (IEC). Through an extensive survey of enterprise IT managers nationwide, the report finds that end users are far from satisfied with existing WAN management services, and that adding applications services to the mix may ultimately save WAN outsourcing.

The report also reveals that 27 percent of WAN users elect to outsource their management. However, a significant percentage of managers who currently outsource WAN management are dissatisfied and expect to take the management of their WANs back in-house. Although there is a segment of managers currently not outsourcing but planning to do so, the growth in WAN management outsourcing is expected to be lackluster, according to the report.

"The good news for providers of outsourcing services is that the introduction of applications services will change this trend," says Dr. Cynthia Gasman, primary research director at CIR and author of the report. "Offering certain applications services as features of WAN management packages can increase the share of outsourcing service providers by 20 percent." Even end users who are relatively price sensitive tend to put this behind them when they are offered applications services as part of a WAN outsourcing package, according to the report. End users who would not otherwise buy into outsourcing services are willing to do so when applications are added to the package.

Inside the Market for WAN Management Outsourcing details the results of a major survey of network managers and IT executives across the country. Topics covered include forecasts for outsourcing market growth through 2010, motivations for outsourcing WAN management, future plans of outsourcing services users, why end users are so dissatisfied with WAN outsourcing options, how outsourcing service providers can differentiate their packages to capture market-share, the impact of firm size and network complexity on WAN outsourcing, and more. The report also contains a detailed segmentation of the WAN outsourcing market, based on sophisticated statistical techniques that describe which packages of outsourcing services can be expected to do well in the marketplace.

"It's clear from these findings that WAN outsourcing is part of the growing ASP trend," says Mike Janowiak, Senior Director of publications at the International Engineering Consortium. "ASPs will continue to grow in importance, and traditional service providers should look to team with them in creating a new generation of services." An example of this is the alliance between Telstra and PricewaterhouseCoopers earlier this year to provision ASP services for enterprise resource planning and customer relationship management customers in Australia/New Zealand, ASEAN, and Greater China.

To purchase a copy of Inside The Market for WAN Management Outsourcing, contact Tom Nguyen at the International Engineering Consortium at 312-559-4636 or [e-mail].