COREL CORP. (www.corel.com).

In November, Corel announced a pilot project to offer subscription- based remote hosting of its WordPerfect Office applications. Corel business development manager Sheldon Speers says the new subscription service, which is currently available only through a single ASP reseller, carries a "list price" of $9.99 per month, per desktop. "We haven't had much customer feedback to date," he says, "though what we have heard has been relatively positive." Speers adds that the new service is primarily aimed at smaller corporate customers who expect to deal with resellers. In the future, Corel will probably develop "a stronger effort" of its own to provide a comparable consumer subscription service.

Remote hosting may be new for Corel, says Speers, but the company has a good deal of history with subscription pricing. In 1997, Corel rolled out a subscription-based site licensing plan that produced "at least 15% of our corporate licensing revenues," and this summer the company began renting its Print House title at several Blockbuster outlets. Speers adds that the $9.99 monthly pricing for a WordPerfect subscription is based on Corel's historic revenues from corporate licenses, amortized over 18 months.

Marketing tactics: Corel's reseller partner is a well-known ASP reseller called FutureLink (www.futurelink.net), which offers WordPerfect Office as part of a comprehensive PC outsourcing service (FutureLink is also a Microsoft ASP). FutureLink provides hardware, tech support, software, and Internet access through one monthly payment. Speers predicts that most companies will end up buying "horizontal applications and services" from resellers like FutureLink, rather than deal directly with multiple publishers. "Obviously, many of these services aren't part of Corel's core competency," he says. "We'd rather work with ASPs like FutureLink than become an ASP ourselves."

Like any reseller, Speers adds, FutureLink pays Corel a discounted price ("comparable to what you'd see on the product side") for the monthly subscriptions it sells.

Development issues: For the moment, says Speers, FutureLink subscribers get "our standard off-the-shelf desktop product," with no modifications. "It's being run using the Citrix MetaFrame technology, in conjunction with a Citrix ICA plug-in to Netscape." However, he says Corel will eventually release versions that support other remote hosting technologies, including SCO's Tarantella and GraphOn's WinBridge. "Compatibility is a key issue in the ASP space," Speers says. "A lot of vertical ASPs are targeting a single platform, but my feeling is that a horizontal application will have to work with everything."

Forecast: "We've done some preliminary revenue projections, and we see the ASP model happening very quickly," says Speers. In two years, he says, ASP revenues "broadly defined" could represent 30%-45% of Corel's total business.

Sheldon Speers, business development manager, Corel Corp., 1600 Carling Ave., Ottawa, Ontario K1Z 8R7; 613/728-8200. E-mail: sheldons@corel.ca.