Ironside, Commerce One Partner to Enhance Exchange Communities
Ironside Technologies Inc., (Pleasanton, Calif.) and Commerce One Inc. (Pleasanton, Calif.) have reached an agreement in principle to provide real-time connectivity to exchange communities housed under Commerce One's MarketSite and Global Trading Web solutions. Terms of the accordance are expected to be finalized by summer 2000.
| Many analysts think exchanges will become among the most lucrative segments of the e-commerce industry. |
Many analysts believe exchanges have the potential to become among the most lucrative segments of the e-commerce industry in the immediate future. According to analysts at Keenan Vision Inc., by 2004 Internet exchanges will generate transactions, in the United States alone, worth approximately $1.7 trillion.
However, Vernon Keenan, Internet analyst and founder of Keenan Vision, says, "Exchanges must have real-time capability to be competitive." And while real-time transactions are somewhat commonplace in traditional retail e-commerce environments, adapting such technology to exchanges hasn't been as easy. Whereas online retail outlets are selling small-ticket items (e.g. apparel, compact discs and sporting equipment), exchanges, for the most part, deal in big-ticket products and services (e.g. aerospace, manufacturing and telecommunications), which possess highly-variable pricing structures, making it more difficult to execute real-time transactions.
Ironside—which has developed e-commerce software for such notable AS/400 industry players as SAP, J.D. Edwards, and MAPICS—has been aggressively leveraging its experience as a sell-side, business-to-business e-commerce software provider to expand its access to exchanges. According to Keenan, the potential for real-time functionality is the main reason Commerce One agreed to a partnership with Ironside.
Under its MarketSite and Global Trading Web solutions, Commerce One hosts a variety of marketplaces in categories ranging from cable and wireless to energy. By partnering with Commerce One, Ironside more than doubles the number of exchanges available to its sellers. According to Derek Smyth, COO for Ironside, gaining access to Commerce One's exchanges "is a way for us to more firmly position ourselves as a top-market, e-commerce provider."
Contradicting Smyth somewhat, Keenan says that partnerships between e-commerce software providers and exchanges are not a new concept, and calls Ironside "a late-comer to the exchange party." He adds, however, "I am impressed with their strategy, though. They're meeting the needs of an under-serviced market—that being suppliers."
Most exchanges on the Internet today focus on the buyer. Keenan believes the supplier to be the more attractive entity, saying, "Exchanges that will flourish are those that create demand for suppliers.
"The combination of community, content and commerce are what makes a successful exchange," Keenan explains. "Ironside boosts the content part of it by bringing in product catalogs from its suppliers." In its attempt to enable real-time transactions, Ironside will also be addressing the commerce aspect of Keenan's successful-exchange equation.
On April 3 of this year, Ironside released the Ironside Network, which is intended to allow buyers and sellers to connect to multiple exchanges and conduct transactions without investing in disparate transaction standards and exchange protocols. "It's the exchange to the exchanges," says Smyth, explaining that by integrating the Ironside Network and Ironside's Ironworks sell-side product suite with Commerce One's XML-based MarketSite Global Trading Portal, Ironside and Commerce One expect to provide suppliers with seamless access to a worldwide buying community.
"Commerce One has done an excellent job of developing an XML-based way to exchange information," says Smyth. "Now we can use XML in a more sophisticated fashion to dynamically connect users, so transactions can be performed in real-time."
Should everything shake out as Ironside and Commerce One have planned it, the end result, says Keenan, would be a "key enabling technology for suppliers."
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