xSP model could revolutionize the way network services are bought and sold

Add the string of letters – xSP – to the information technology alphabet soup of acronyms.

Continue adding more three- and four-letter abbreviations to the mix, as xSP IT and business services market company types emerge with newer types of offerings. Information technology hardly needs another ambiguous set of short forms to further confound an already confusing subject. However, that said, xSP may soon become quickly recognized as one of the most important and highly recognized service concepts in IT.

If you haven’t already, you’ll be hearing a whole lot more about the term xSP – the key latter two letters standing for Service Provider and the “x” signifying an “insert-your-service-type-here” meaning – which is something of a catch-all for an emerging breed of service providers looking to host IT applications and resources, deliver business services and/or sell IT infrastructure as a managed service to customers.

Included among the xSP group would be more familiar Application Service Providers (ASPs) and Internet Service Providers (ISPs), as well as newer concepts such as Systems Infrastructure Service Providers (SISPs), Network Service Providers (NSPs) and Business Service Providers (BSPs) to name but a few.

While there exists a wide range of potential service types in this emerging categorization, what’s common among xSPs is the characteristics that define how services are delivered to customers. These are:

– delivered over a network;

– always externally managed;

– one to many (that is, a standard service type for multiple customers with minimal customization); and

– service is fee-based (typically per port- or usage-type pricing).

The overall idea of the xSP delivery model is to offer enterprise customers IT and business functions like a “utility” service, similar in concept to electric and telephone services, by leveraging networks as service delivery vehicles and offering standard types of application, infrastructure, business, management, content and process services and contracts.

There’s a wide range of variance in terms of how little or how much IT a company may choose to outsource to an xSP. One business may look to purchase some IT storage and/or backup capability, so it looks at a storage service provider (SSP). Alternatively, another business might want to completely offload its IT and look to the xSP approach, either through one company or a number of services suppliers, as an alternative to total outsourcing and in doing so may purchase as services its networks, systems infrastructure, development environment, applications, content, process support and process execution. Both options and a range of others in between could be addressed in the xSP world.

Many types of hardware and software have continued down a path towards becoming commodities with elements that have the same essential set of core functions that become generic. IT services, however, have largely remained customized and unique offerings. xSP proposes doing for services what’s been accomplished on the product side – creating a commodity product.

In addition, the xSP notion is about the rapid and simple provisioning of IT. Need generic word processing, spreadsheets or groupware?

Then rent one from an ASP. Need the infrastructure to drive your Web site applications or a repository for off-site storage? Then look to a hosting service provider (HSP). Need a highly managed, high-performance communications network? Then buy it as a service from an NSP. You get the idea.

Again, what you’d receive from an xSP is a more generic type of outsourced service with limited tailoring options. But it would also be one which may be much better suited to the particular needs of your business, one that should be cheaper than other types of outsourcing, and certainly a set of services that are a lot more flexible and quicker to deploy than traditional outsourcing.

Do xSPs actually exist? As with most things IT, the xSP concept is significantly more advanced in the United States and services are available in the form previously described. In Canada, however, there’s work to be done in continuing to define xSP services and creating the right set of packages for Canadian business. Being a country much less inclined – particularly among small- and medium-sized businesses – to outsource, xSP offerings here may conceivably look much different, at least initially, from those offered in the U.S.

Current engagements for utility-like services and business processes often more closely resemble traditional outsourcing. That is to say that the provisioning of IT infrastructure as services sees a high degree of customization in order to suit a particular set of business and IT requirements. But these engagements will undoubtedly be defining and helping service companies identify both the type and nature of xSP services, which might appeal to a broad base of Canadian businesses, especially smaller ones.

Those who’ll deliver xSP-type services will come from new and familiar sources. They’ll include traditional systems and network integrators, telecommunication companies, software and hardware vendors, plus an emerging set of hosting service companies and any number of niche companies who’ll specialize in particular applications, infrastructure function or whatever. The xSP market will encourage partnering to deliver the full breadth of services.

These are early days for the xSP concept, but the promise held is one that would see a dramatic change in the way vendors deliver and provide IT and business services, and in how Canadian businesses purchase them.