Commerce One's annual meeting was held in Las Vegas On September 18-20.
Items about partnerships and recent successes dominated the announcement
list. One significant exception was the release of Auction Services 4.0,
Commerce One's B2B auction management product. This release provides support
for more complex transactions than before, puts more types of auction
at the customer's disposal, and has Request for Proposal and Request for
Quote capabilities. The release will available in Q4 of 2000, both as
a separate product and integrated with the joint offering from Commerce
One and SAP AG's SAPMarkets subsidiary. A related announcement stated
that Commerce One customers had reported involvement with auctions having
a total value of over $2 billion.
previously announced (see SAP
Gives Up, Declares Victory Again ), the partnership with SAP remains
big news for Commerce One. The jointly developed products MarketSet and
Enterprise Buyer are now generally available. MarketSet is an eMarketplace
suite that includes both collaborative supply chain capabilities and business
process analytics. Enterprise Buyer is a buy-side e-procurement application.
to some was Commerce One's decision, as revealed by TheStreet.com, to
terminate development of its own buy-side solution in favor of the new
announcements at eLink2000 included
- A joint
effort with Boeing Corporation to enable EDI-based companies to join
Exostar, the Aerospace & Defense industry's global e-marketplace
- A partnership
with systems developer Computer Sciences Corporation to provide e-commerce
solutions to business and governments on a worldwide basis and to Federal
markets in the United States
- An agreement
that Cap Gemini Ernst & Young U.S. LLC would be a solutions provider
for Commerce One products and services
- A strong
alliance with Compaq. Commerce One will make Compaq equipment the preferred
servers for its NT systems, Compaq will be a reseller of Commerce One
products, and Compaq Global Services will be a tier one, preferred global
systems integration partner for Commerce One worldwide.
This is a solid set of announcements, but it doesn't generate the excitement
of Ariba's. The SAP partnership will be a terrific source of revenues
for Commerce One, but we think it will not prove much of a technological
boost. This isn't a bad thing. We're sure that Commerce One has more innovation
up its sleeve, and as the details of its arrangement with General
Electric become clearer we may see a number of announcements that
are both financially and technologically interesting.
(technological) excitement was muted, surprise was abundant. As measured
by its official press releases, Commerce One seems to have wanted to play
down the termination of BuySite, and not without reason. This represents
a major change in direction. In general we think it is a wise one. Many
companies will be happy with buy-side software from third party providers
that provide on-ramps to Commerce One. Commerce One can move more into
concentrating on marketplaces and transaction-based revenues.
move has two potential downsides though. Current BuySite customers are
bound to feel uncertain, if not unhappy. And we're not so sure about moving
that much closer to SAP, especially in the early stages of their relationship.
We'd hate to have Commerce One find, a year down the road, that they've
lost independence of action by doing this. Developing a strong relationship
with GE may be necessary to counterbalance the weight of SAP.
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.
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.
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.