Microsoft Tackles E-Commerce through Service Providers

Microsoft Corp. launched a two-pronged effort to capture a greater share of the e-commerce market for the Windows NT Server platform.

The company announced Complete Commerce and the Commerce Solutions Directory last month. The Complete Commerce toolkit is designed to help Internet hosting service providers design, set up and market services based on the Microsoft platform, third-party software and hardware from Compaq Computer Corp. and Intel Corp. The Commerce Solution Directory ( directs companies to ISPs and other hosting service providers that can put their business online using the Microsoft platform.

According to Microsoft’s hosting program manager, David Ostroff, the offerings fit the growing needs of midmarket customers who have brochure-type Web pages but lack the expertise to handle transactions online. "The middle market is feeling the pressure. That’s the sweet spot in the market," Ostroff says. Microsoft can also make headway among enterprise customers disillusioned with the expense and difficulty of hosting e-commerce themselves, he says. "The typical trend is the enterprise customer starts out thinking they can do this in-house and moves to outsourcing once they start to lose business."

Service providers that offer the Complete Commerce solution will have one-stop shopping for consulting, Web development, hosting services, entire order processing and delivery and a well-defined delivery timetable. The cost is about $50,000 up front with additional service charges thereafter, Ostroff says.

Several companies offer the services, including American Information Systems Inc., Concentric Network Corp., Data Return Corp., Digex Inc., GTE Internetworking, Icon CMT Corp., MCI/WorldCom Advanced Networks, Northwest Nexus Inc., USinternetworking Inc. and USWeb/CKS.

In an effort to expand the base of Web hosting providers offering the Complete Commerce solution on the Windows NT Server platform, Microsoft offers a toolkit to help service providers get started. The how-to toolkit instructs service providers on integrating Microsoft Site Server Commerce Edition with Cybercash for flexible payment processing, TanData for shipping and logistics and Taxware International for tax calculation on Compaq ProLiant servers with Intel Pentium II or Pentium II Xeon processors.

Analyst Scott Smith with Current Analysis Inc. ( says the solution plays to Microsoft’s strength in marketing and avoids a potential weakness by leaving hands-on customer service to the ISPs. "Probably the biggest distinguishing mark is there’s a full-service marketing program and ISP support," Smith says. "It’s not something I would call vaporware, but it’s not a radical approach. It’s bundling, it’s packaging."

As far as the robustness of the platform, Smith says it will probably work best for midtier companies filling online product orders from consumers. "I wouldn’t use this for, but I might use this to support Virtual Vineyard," he says.

Ostroff says the company plans to expand the services beyond supporting Internet product orders and wants to achieve the goal with the help of the service providers it recruits for its solutions directory. "Where the customer really wants to go is back-end integration into their accounting and ERP system and warehousing system," Ostroff says. "We are [working on] doing the same thing for corporate purchasing, supply chain interface and ERP outsourcing."