A new set of best practices and guidelines for dispute avoidance
and resolution has been drawn up by the Geneva-based World
Intellectual Property Organisation (WIPO) Arbitration and Mediation
Centre and the Application Service Provider Industry Consortium
(ASPIC), a non-profit international consortium made up of the
world’s leading technology companies.
The WIPO Arbitration and Mediation Centre can now provide
dispute resolution services to contracting parties in the ASP
supply chain through its ASP Dispute Resolution Service.
ASPs deliver and manage applications and computing services from
remote data centres to multiple users via the internet or a private
network. Using an ASP model, small and medium sized organisations
have the possibility of deploying business applications that would
otherwise involve massive investments in software, deployment time
and IT personnel.
The ASP model has recently suffered, with its growth being
slower than was expected a few years ago. However, according to a
new report from researchers IDC, the ASP market in Europe will now
double in size every year until 2005 at which point IDC predicts a
valuation of $5.8 billion.
ASPIC, which has more than 700 industry members in 30 countries,
asked WIPO to create the dispute resolution service. There are a
number of areas in IT relationships, such as those that
characterise the ASP model, out of which disputes might arise,
including software or hardware performance, quality or function,
project management performance, copyright and proprietary rights
infringement, service failure, and loss of data or data
integrity.
Because of the "one-to-many" delivery model, an ASP’s liability
exposure in each of these and other areas is multiplied
several-fold. Particularly in a cross-border international
relationship, the commercial and legal risks increase
significantly, as does the potential for conflict arising from
different legal systems, different commercial and legal cultures,
and language and cultural differences. The quick and cost-efficient
resolution of disputes, together with effective dispute avoidance
strategies, is seen as fundamental to the success of the ASP
industry.
