Not Your Father's EDI

It's no surprise that the Internet and Web are taking electronic data interchange (EDI) market in a whole new direction. However, recent findings from IDC (Framingham, Mass.) find that EDI--in a more "Webized" form--will continue to thrive.

Despite revenue growth of almost 18 percent in 1998, the market is rapidly reaching full maturity and is on the brink of transformation. says Stephen Murray, research manager for IDC. "The classic EDI paradigm has nearly saturated the markets and applications for which it has been best suited. It is not so well suited to serve those markets representing the greatest growth opportunities." He notes that Internet technologies have begun to change the market, and through 2003, they will be the primary drivers of growth.

"Many large enterprises maintain they are happy with their electronic data interchange, but their golden handcuffs will begin to chafe," Murray said. "The companies are inviting in new technology vendors, asking questions, and studying the alternatives. They aren't sure what's next, but they want to know, and they are looking for direction."

The good news for traditional EDI vendors is that IDC believes they will have little difficulty incorporating and exploiting Internet technologies to ride the next wave of e-commerce growth. According to IDC, revenues for EDI network services will increase from $1.1 billion in 1999 to almost $2.3 billion by 2003. Internet EDI's share of transaction EDI revenues will jump from 12 percent to 41 percent during this same time frame.

Recently, CommerceNet announced that leading EDI vendors Compaq, Cyclone Software, GE Information Services, Harbinger, IPNet Solutions, Microsoft, Netscape, SAA Consultants, Softshare, and Sterling Commerce have passed Secure EDI Internet Interoperability testing for ten products to be commercially available in the near future. The development of solutions that allow the secure, protected exchange of EDI business documents over the Internet is critical in making the Internet more business-friendly.

CommerceNet was instrumental in sponsoring the second successful interoperability tests for secure exchange of EDI information over the Internet 13 months ago. Four of the previously certified companies have retested with six additional companies to ensure interoperability. The testing verifies that users may purchase off-the-shelf interoperable software from any of these vendors that supports encryption, digital signatures, integrity, and signed receipts among the other nine products. These services are based on S/MIME and IETF specifications.

The goal of this testing program is to accelerate the development of interoperable secure Internet-enabled EDI products. The CommerceNet-sponsored interoperability testing is based on the work of the EDIINT Workgroup from the IETF. This workgroup has produced recommendations on how to implement secure Internet EDI exchanges using either PGP/MIME or S/MIME. The next interoperability pilot is scheduled to begin in January 2000.

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