E-commerce portals open for business (to business)
May 6, 1999
Network World: NEW E-COMMERCE SITES
Web-based portals built for business-to-business electronic commerce are starting to dot the Internet landscape, which until now has taken portal to mean a content-rich search engine, such as Yahoo or Lycos. These business-to-business e-commerce portals let trading partners swap purchase orders and other critical documents over the Internet. Once the document is deposited at the portal, the portal either stores it for retrieval or forwards it immediately to the intended recipient's server.
These e-commerce portals typically log all this vital activity and handle document conversion, too, translating HTML or other formats into fax or electronic data interchange. In this regard, they evoke the spirit of electronic data interchange value-added networks (VAN), which continue to process huge volumes of business data, mostly for larger corporations.
But old-style EDI VANs are based on proprietary protocols and technologies for store-and-forward mailboxing. In contrast, e-commerce portals are built on IP protocols so they can push documents along quickly using the Web's HTTP or File Transfer Protocol.
Proponents of portals think it's going to be much easier, and less expensive, for smaller firms to do electronic trading over the Internet than traditional EDI.
Not surprisingly, a number of traditional VANs are jumping on the e-commerce portal bandwagon, hoping to pick up new business or offer a migration path. Harbinger Corp. says it intends to migrate 6,000 corporate customers this year from its traditional EDI VAN to the new e-commerce portal it opened this month, called Harbinger.net.
While there's no sign of a stampede yet among Harbinger's EDI customers toward this e-commerce portal, at least two companies, Armstrong Air Conditioning and Honeywell, have started to do business with hundreds of their smaller suppliers via Harbinger.net.
GE Information Services, one of the biggest EDI service providers, two years ago launched GETradeWeb.com as a Web front end to its VAN - long before it was cool to call this a portal.
"DaimlerChrysler is using this to exchange 18 different types of documents with their suppliers around the world," says Jeff Anderson, global product manager for GE Trade Web, which is estimated to have a total of 3,500 trading partner subscribers.
Hey, we're portals, too
No single group has latched harder onto the e-commerce portal buzzword than software upstarts such as Intelisys Electronic Commerce, Ariba Technologies and Commerce One.
Their bread-and-butter has been making and selling high-end procurement software. But now each of these start-ups is angling to provide transaction-based services, too, in portals they either operate alone or in partnership with a high-tech provider. Commerce One announced ambitious plans for this year to construct three global e-commerce portals based on its software, with help from British Telecommunications, MCI WorldCom and NTT. These three telecom giants will each host the service and share a percentage of the transaction fees with Commerce One.
And then take feisty e-commerce vendor Ariba. It sells an intranet product called Operating Resource Management System (ORMS) for managing desktop-based purchasing from electronic catalogs. Ariba is now partnering with Hewlett-Packard to build the Ariba. com Network. This Internet-based transaction-processing service is slated to debut in June.
Cisco is beta-testing the Ariba portal, which uses ORMS internally to automate the procurement of office supplies. Until recently, Cisco had been sending out ORMS-generated orders to its suppliers by e-mail. "But with the high volume, this e-mail doesn't integrate very eloquently with our suppliers' systems," says Cisco's business process design manager, Carolyn DePalmo. "It causes them to re-key the data."
Instead, Cisco will send these purchase orders directly to the Ariba.com Network, where they could be converted into a variety of data formats favored by each supplier, or put into an EDI VAN.
In a similar manner, Ariba competitor Intelisys is opening its own business-to-business on-ramp named Intelisys.com, with Houston manufacturer Hose and Fittings as an anchor tenant.
Health-conscious portals
There are also portal initiatives taking shape to serve specific vertical industries. ChannelPoint, Inc., for example, is constructing a portal called ChannelPoint Commerce for the health insurance industry.
"It's a $700 billion market dominated by independent brokers," says Lyle Ekdahl, ChannelPoint's vice president of product marketing. "This will be the first Internet exchange for insurance." ChannelPoint, set to open in June, has about a half-dozen insurance carriers, including United HeathCare and a few of the regional BlueCross/BlueShield companies, set to use the portal.
These insurance companies will use ChannelPoint to post insurance quotes for the brokers and process orders sent from them. "We get paid when we deliver business to the carrier," Ekdahl says. "They pay us a percentage of the business." It will be free for brokers, though.
<<Network World -- 05-03-99, p. 40>>
[Copyright 1999, Network World]
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