ASPs failed ? But are now making a comeback -ZDNet:
Some five to six years ago, Application Service Providers (ASPs) were one of the hottest categories in software. They would transform the way software would be delivered and create a win-win situation for customers and software vendors. That dream did not pan out.

ASPs offer applications over the internet using their own servers to customers, who pay a regular fee for the use. For companies, there is no need to own either the application or the underlying infrastructure.

For service providers, it helps them aggregate a large number of customers, providing economies of scale. Using the internet as the distribution medium, ASPs can reach out to customers globally.

ASPs in many respects presented a false start in the efforts to break out of the enterprise straitjacket. In particular, few of them adopted Web services architectures as their technology platform. Instead, they attempted to build businesses on the internet using traditional technology architectures. This proved a significant flaw in the early ASP model.

The big opportunity for ASPs is the long tail of enterprises in the world's developing countries. They have been largely unaffected by the internet - other than email usage and in some cases have a minor web presence.