K.B. Chandrasekhar, founder of Web hosting pioneer Exodus Communications Inc., is at it again.

This time, Chandrasekhar wants to take hosting to another level with a new company, Jamcracker Inc., which is making a play at the midsize-business market and is looking at VARs and systems integrators as integral partners.

Jamcracker is not positioning itself as an ASP but more as a provider of a software backbone with a suite of bundled services aimed at the middle market. The suite offers a host of applications ranging from human resources and finance to customer relationship management (CRM) and IT services such as remote access and network management. The move is to be announced today.

"Jamcracker is an exciting new concept in the emerging ASP market. We work back through the resellers who have an extensive relationship with the customer and allow them to plug into this platform," said Chandrasekhar, Jamcracker's chairman and chief executive. He also remains chairman of Exodus.

Jamcracker is looking to work with VARs and systems integrators that can provide the connectivity for the customer while Jamcracker provides the software backbone. "The reseller will still be able to provide the hand-holding support [on-site] that will be required," Chandrasekhar said.

The company is developing a channel program and has tapped former Microsoft channel executive Sam Jadallah, now managing director at Internet Capital Group Inc. (ICG), as one of its board members. ICG, a Wayne, Pa.-based Internet investment and management firm, is also a lead investor in Sunnyvale-based Jamcracker, which has raised $42 million in its first round of equity and debt financing.

"Sam Jadallah has worked extensively with the reseller community [during his tenure at] Microsoft [Corp.], and we will have him guide us and help us structure our program in such a manner so that the reseller can use us as an effective software backbone," Chandrasekhar said.

Eric Klein, senior analyst at The Yankee Group, Boston, sees Jamcracker as the next step in the hosting market. "It's an interesting model that is going to be established. It's all about the platform and the partnerships and the type of partners they pick that will determine how successful they will be," Klein said.

Jamcracker will leverage the infrastructure backbone of Exodus and work with other ASPs to offer certain applications, Klein said. Resellers can enter the Jamcracker portal and view support notifications and detailed information about their clients' IT structure down to the desktop, Jamcracker executives said.

Jamcracker distinguishes itself in a crowded ASP field with its IT services, said Laurie McCabe, an analyst at Summit Strategies Inc., Boston. The biggest differentiation is Jamcracker proposes to manage not just the outsourced solution for the midsize-business customer but also its information technology, she said.

Jamcracker offers three service levels. Core services include a portal and IT reporting and support dispatch. Enterprisewide services include e-mail, Exchange server, remote access and desktop management. Business services include human resources, finance and CRM applications.

Jamcracker's willingness to go to the channel is key, Klein said. "The systems integrators and VARs are a very good way for them to get new customers on board. It is also a good model for the VARs and the systems integrators to be able to offer value-added services to their customers that they could not have been able to offer them. [Resellers] get a chance to look beyond the box."- CRN

Listen to an interview with Jamcracker's CEO at: www.crnnewsradio.com