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PROSPECTUS SUMMARY
YOU SHOULD READ THE FOLLOWING SUMMARY TOGETHER WITH THE MORE DETAILED
INFORMATION REGARDING OUR COMPANY AND THE COMMON STOCK BEING SOLD IN THIS
OFFERING AND OUR CONSOLIDATED FINANCIAL STATEMENTS AND NOTES APPEARING ELSEWHERE
IN THIS PROSPECTUS.
ARIBA
Ariba is a leading provider of intranet- and Internet-based
business-to-business electronic commerce solutions for operating resources.
Operating resources are the goods and services required to operate a company,
such as information technology and telecommunications equipment, professional
services, MRO (Maintenance, Repair and Operations) supplies, facilities and
office equipment, and expense items. Operating resources are often the largest
segment of corporate expenditures, representing approximately 33% of an average
company's revenues, according to Killen & Associates.
Today, most organizations buy operating resources through paper-based
processes that have remained largely unautomated by the information technology
advances of the last 30 years. With the recent widespread adoption of internal
computer networks based on the Internet protocol, or "intranets," and the
acceptance of the Internet as a business communications platform, organizations
can now automate enterprise-wide and inter-organizational commerce activities.
As a result, Internet-based business-to-business electronic commerce is expected
to grow rapidly from $43 billion in 1998 to $1.3 trillion in 2003, exceeding
business-to-consumer electronic commerce by a factor of nine to one in 2003,
according to Forrester Research. This market is expected to create a substantial
demand for intranet- and Internet-based commerce applications. According to
International Data Corporation, the worldwide market for Internet-based
electronic commerce procurement and order management applications will
experience tremendous growth, increasing from $187 million in 1998 to $8.5
billion in 2003.
Ariba is pioneering the use of intranets and the Internet to automate the
procurement and management of operating resources. Our Operating Resource
Management System, Ariba ORMS, enables organizations to automate the procurement
cycle within their intranets, lowering the costs associated with operating
resources. Our recently launched Ariba.com network is a global
business-to-business electronic commerce network for operating resources that
enables buyers and suppliers to automate transactions on the Internet. Together,
Ariba ORMS and Ariba.com combine intranet-based network applications with an
Internet-based network to create a business-to-business electronic commerce
solution for operating resources that benefits both buyers and suppliers. Since
we began marketing Ariba ORMS in March 1997, it has been licensed by large,
multinational industry leaders and public sector organizations including
Chevron, Cisco Systems, FedEx, Hewlett-Packard, Philips, U S WEST and Visa.
Our objective is to create the leading Internet-based business-to-business
electronic commerce network for operating resources. Our strategy to achieve
this objective is to take advantage of the buying power of a large multinational
customer base to attract leading operating resource suppliers to our Ariba.com
network. We believe a growing number of suppliers in our Ariba.com network will
in turn draw more buyers to our network. We also believe this growth cycle will
help create a network effect, where the value to each participant in the network
increases with the addition of each new participant, increasing the overall
value of our Ariba solution.
--from the June 1 S-1/A
--Bill
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