This is a very long article about portals, and not one mention of GNET, but I thought it might make for interesting reading....Maybe if CHTR were up and running with GNET as it's portal, then GNET would be someone to be reckoned with!
upside.com
The portal keepers
June 07, 2000
by Paul Franson
An Internet eon ago -- two years on the Gregorian calendar -- dozens of consumer portals positioned themselves as the vital doorways through which consumers would access news and products and exchange information in the vast digital world. But within a year, the concept of numerous hubs of online access had become stale. Internet portal companies decided that they didn't want to become doorways, but rather buildings themselves. They wanted to be malls that housed information and e-commerce and attracted advertisers.
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There are clearly more players than the market can support -- in the New Economy.
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The market, however, doesn't need a string of online malls. Three giants, America Online (AOL), Microsoft Network (MSFT) and Yahoo (YHOO), have captured the broad consumer markets, leaving crumbs for other portals. These secondary portal companies are seeking safe havens in smaller niches that remain largely untapped. The main target: the hot business-to-business arena.
Unfortunately for secondary portals, the big three covet the same opportunities and are determined to dominate the b-to-b market as well.
B-to-b laps b-to-c
You'd have to be in a coma to miss the hype about b-to-b e-commerce. Everyone on the Internet, from startups to established industry groups and trade publishers, is fighting for a place in b-to-b. "A land grab is going on," says John Katsaros, vice president at Jupiter Communications, a market research firm in Los Altos, Calif.
The rush for these portal sites to serve businesses shouldn't be a surprise; businesses spend a lot of money. Currently, the largest e-commerce sites, headed by Cisco (CSCO), Intel (INTC) and IBM (IBM), serve businesses. Cisco alone, with $12 billion in online sales last year, dwarfs even consumer e-business powerhouse Amazon.com (AMZN) with its $1.6 billion in 1999 revenue. In reality, much of the money spent at consumer sites comes from the small-business coffers. There are 9 million small businesses with fewer than 25 employees and 10 million home offices in the United States, notes Katsaros. These figures show an enormous market.
Forrester Research forecasts that b-to-b e-commerce will hit $2.7 trillion in 2004, half through online exchanges. It also finds an overwhelming majority -- 93 percent -- of corporations plan to transact business over the Net in two years.
Even more bullish in its prediction is the Gartner Group, which expects the b-to-b market to grow from $145 billion in 1999 to $7.3 trillion in 2004. That would represent 7 percent of the $105 trillion it forecasts for all global sales transactions.
Industry-specific sites
Though many b-to-b portals target broad markets, the biggest hype is about vertical portals, also known as vortals, aimed at specific industries. Many industry-specific sites are evolving from online directories, catalogs or trade magazines into central markets for their respective industries, developing exchanges where products and services are bought and sold. In the process, these portals could fundamentally change the way entire industries operate, from steel to shipping to biotechnology.
But as trends go, there are clearly more players than the market can support -- in the New Economy. As thinning out continues, it is expected that only one or two sites will serve each category. Yet even a small market such as the $8 billion wholesale U.S. wine business has attracted at least a dozen players hoping to serve wineries, wholesalers, retailers, restaurants and bars. WineryExchange.com, for example, raised $9 million from Venrock Associates, 3i and VTraction to pursue what it calls a $104 billion market worldwide.
One company, VerticalNet Inc. (VERT), has started or acquired 55 of these vertical sites, revealing its foresight into the industry. From its site, Web users can link to a broad range of portal sites concentrating on specific markets from the government sector to the environment.
VerticalNet has emerged as a leader with its comprehensive reach of the market. It has managed to put industry-specific sites, with top-rate information, under one roof. But Jupiter's Katsaros says it's not clear whether it is better to invest heavily in one industry or throw funds into a pool of different industries. Law.com, for example, is one cooperative site that is attempting to create a one-stop shop for lawyers, law students and consumers interested in the law. In contrast, VerticalNet has acquired a range of sites for many topics. Its "communities" are organized around an "editor" and include news, directories and a marketplace, though some aren't very active yet.
Other prominent vertical b-to-b players struggling to stay in the market include Ariba (ARBA), CommerceOne (CMRC), Vitria (VITR) and FreeMarkets (FMKT). One b-to-b convergence is touting its move as the largest acquisition in software history: Supply-chain software maker I2 (ITWO) acquired b-to-b content providers Aspect Development and Supplybase for almost $10 billion in stock. This thinned the overcrowded marketplace for software, facilitating synchronized parts orders for designing high-tech products to a database of components, and it is a trend that is sure to continue as the market grows more saturated.
The b-to-b bazaar
A second category of b-to-b sites is the exchange, a forum for matching sellers with buyers. Some are for specific markets; most vertical sites incorporate one of the two categories. Others cross industry boundaries, offering products of interest to many different industry segments. Some feature fixed prices, but more seem to be intended as auctions or outlets for haggling.
Unfortunately for many competing startups, both Yahoo and AOL have expanded their reach to incorporate these new exchanges. Yahoo recently launched its b-to-b Marketplace, anchored by industrial auction house Dovebid Inc., which paid its way into Yahoo's featured auction house. The site offers everything from surplus drill presses to giant construction equipment.
From the Yahoo Marketplace, a user can also search other affiliated market sites with competitive offerings. Some offer "variable" pricing -- some are fixed, some are vertical, others horizontal. "We're being pretty agnostic about these issues to see what the market wants," says Brian Fitzgerald, product manager for Yahoo.
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