November 29th, RightWorks announced plans to make its procurement solution available
via the web. They chose Exodus Communications, Inc. (NSDAQ: EXDS) as an exclusive
host. The new service will allow small to midsized businesses to benefit from
RightWorks' procurement applications without the additional investment of installing
and maintaining an additional computer system.
4 provides the tools to consolidate supply base, control spending, leverage
buying power and streamline procurement operations. It is available in both
standalone and Procurement Service Provider (PSP) models through a subscription
announcement represents an emerging market of web hosted business applications.
By leveraging the internet, Application Service Providers (ASP) may deliver
business tools while simultaneously creating user communities with tremendous
ASP market is in its infancy. The market, participants and focus remains undefined.
The move by Rightworks and Exodus is a natural progression as procurement software
providers look to partner with web centric organizations (See TEC News Analysis
Express Selects Tradex To Build New Business to Business Commerce Network"
December 15th, 1999).
This announcement is appealing to small or mid-sized organizations considering
a procurement application. The value proposition is attractive, as companies
will save capital otherwise spent developing, implementing and supporting a
custom network. Companies also gain the power of a consolidated marketplace
which could help reduce costs through quantity discounts or pre-negotiated pricing.
don't jump yet. RightWorks has only announced a hosting agreement. There are
licensing, bandwidth, information usage and security issues that need to be
considered. Performance and reliability statistics are not available at this
time. Additionally, Rightworks is not alone in the procurement space and face
stiff competition from Ariba, Commerce One and Concur.
unique factor RightWorks offers is a rentable procurement solution coupled with
the power of a digital market place. First, we recommend that organizations
determine if their procurement solution has the features you need and if their
market place has the type of buyers/sellers that are right for you. Only then
should the organization consider the buy versus rent issue.