Ariba Holds Announcement Festival

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Ariba Holds Announcement Festival
D. Geller - October 2, 2000

Event Summary

Ariba held the "LIVE Miami" 2000 event in Miami, Florida to showcase some notable successes and new announcements. One of the most significant was the completion of the first phase of the roadmap for the IBM/i2/Ariba alliance (see B2Big Deal for IBM, Ariba, and i2). Claiming that the effort required 300 developers for a period of two and a half months, the alliance announced that the baseline components of Ariba's B2B Commerce Platform and i2's TradeMatrix solution have been made interoperable with IBM's hardware platforms, its middleware, and its Application Framework methodology.

Ariba also announced "a start-to-finish methodology for implementing the Ariba B2B Commerce Platform." Dubbed AribaLive the package helps partners and customers manage the implementation of the Ariba platform, and also provides an extensive knowledge base. According to Scott Mulder, program manager for AribaLive, "by leveraging the AribaLive Web-based deployment management system, we can share a new liquidity concept with our partners, gather feedback, polish and pilot the new approach, and get it to the field in a matter of days."

Ariba has obtained a number of new customers, of which the most significant among the recent announcements was Transora, a global B2B eMarketplace for the consumer food products and services industry. Transora selected the Ariba B2B Commerce Platform and i2'sTradeMatrix solutions for its worldwide food, beverage, and consumer products marketplace.

Market Impact

Unquestionably the best news for Ariba was the progress on the alliance with IBM and i2. Supply chain integration has become a significant piece of Ariba's overall strategy. With i2's tremendous strength in its industry (see i2 Technologies at the Front of the Supply Chain) this will be a major source of revenue for Ariba. On the other hand, it will also represent a major drain on resources; these are not out-of-the-box installations. We therefore expect to see Ariba pulling back to some degree from marketplace projects that do not involve a supply chain component. Projects of that nature brought in by their IBM Global Services partners will inevitably take precedence. Of course, Ariba is hoping to have the majority of those projects handled by systems integrators or by the customers themselves, and the AribaLive package is a step in that direction. But to some extent we think that Ariba will be ceding some of the pure-marketplace sales to Commerce One.

User Recommendations

Both Ariba and Commerce One remain obvious choices for e-procurement and marketplace solutions, but the trick for the user is determining which company makes the best match. A company of any size whose major interest is in a buy-side procurement solution will find other vendors anxious for the business. One of these is now SAP, of course. TEC believes that Ariba will not part with its own buy-side software as easily as Commerce One did, both because Ariba doesn't have a partnership that is likely to produce and market a replacement and because the company remains emotionally attached to that part of its business.

Although SAP's first shot at e-business, mySAP, fizzled, we expect the new approach to succeed and to carry Commerce One along with it. How much Commerce One will become tied to SAP to the exclusion of other markets is hard to tell. In a chicken-and-egg way it may depend on how tight potential customers perceive the linkage to be. We continue (see Commerce One: Everything but Profits) to predict some kind of fissioning in Commerce One, such as a formal separation between the marketplace and procurement sides of the business.

But overall there is no obvious winner in the sweepstakes. Customers for whom a sophisticated supply chain solution is the overriding concern will lean toward Ariba, just as current SAP users will lean toward Commerce One. But the complexities of these solutions, and the overall similarities between the capabilities of the two companies, dictate that users conduct very careful evaluations of both before making a decision.

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