Event
Summary
Commerce One, which recently became SAP's partner in e-commerce (see SAP
Gives Up, Declares Victory Again) has entered into a closer partnership
with Microsoft. Commerce One's products are already NT-based, but the
new partnership will allow Commerce One to develop infrastructure technologies
optimized for the Microsoft .NET Platform. The two companies will also
collaborate on XML strategies.
Commerce
One stated that new revenues from this agreement should start to appear
within the current quarter. These revenues will come primarily from expanded
licensing possibilities, and the ensuing transaction revenues, that will
come from "global marketing and sales initiatives" between the two companies.
In
other words, Microsoft will be promoting and pushing Commerce One solutions
across the world.
The
stock market showed modest approval of the announcement, with Commerce
One going up fifty-six cents. More interesting is that shares of another
e-procurement vendor, Clarus dropped 18% on the news - or, to be accurate,
Clarus shares dropped and some analysts attributed the drop to the news
about Commerce One, reasoning that Clarus' own relationship with Microsoft
would be weakened by the Commerce One deal.
Market
Impact
TEC is concerned but somewhat skeptical about the relationship between
the Commerce One deal and the Clarus drop. As Figure 1 shows, Clarus'
stock problems do predate the Commerce One-Microsoft announcement. Analyst
predictions that Clarus may have a disappointing quarter are surely a
large component of the dip in price. On the other hand, Clarus itself
notes that "A significant number of our new Clarus eProcurement sales
and Clarus eMarket sales have occurred through referrals from Microsoft."
So it would be hard to discount some effect on Clarus. Frankly, we don't
see Clarus and Commerce One evolving toward the same customers, so Microsoft
may continue to market for it - and if not Clarus should be able to recover.
Figure
1.
Source:
Quicken.com
User
Recommendations
Do not write Clarus off as a potential vendor. However, should it happen
to suffer a few blows in the near future - that is, if it has a poor quarter
and if Microsoft does terminate its marketing assistance - then we would
be concerned about its future, and would recommend a close analysis before
signing.
For
potential customers of Commerce One, your other obvious choice is Ariba.
We think this news is good for you because it will clarify the different
directions of the two companies, and make it easier for you to find a
best fit for your requirements.