The application service provider (ASP) market has entered its puberty stage, in which it faces new challenges and higher expectations in the outsourcing market. The current state of the ASP market has failed to win customers; changes must occur if ASPs are to make it past the interim, awkward stages of youth and into the established realm of mature enterprise-focused providers. This article reviews three challenges to the ASP market, and how application service providers will address their previous shortcomings.