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To: Mark Fowler who wrote (113165)	12/21/2000 2:29:09 PM
From: H James Morris	Read Replies (1) \| Respond to of 164684

Mark, I can afford to buy because of the B2B mania. December 21, 2000 12:00 AM PT by Adam Feuerstein RELATED STORIES • VerticalNet CEO: We're just like Ariba, Commerce One • Commerce One sinks on customer loss • More by Adam Feuerstein The b-to-b software sector has been largely immune from the plague of earnings warnings currently wreaking havoc across the Nasdaq, but that hasn't stopped stocks from sinking lower and lower. The glass-half-full crowd believes that the b-to-b software firms are a safe haven in troubled times. That's because companies place a premium these days on saving money or increasing the efficiency of their operations. And when they use software from Ariba (ARBA) or Commerce One (CMRC) to purchase supplies over the web, or install supply chain management software from i2 Technologies (ITWO) or Oracle (ORCL) that allows them to communicate better with suppliers, they're doing just that. So, faced with a decision to buy every secretary and middle manager a new Dell (DELL) PC, or build a private online marketplace to save the company millions of dollars in purchasing costs, today's CEOs -- facing a hostile market -- will choose the latter option quickly. -------------------------------------------------------------------------------- SPECIAL REPORT: TECH MAY NEVER BE THE SAME See more stories>> -------------------------------------------------------------------------------- Few warnings, stocks still slumping So far, none of the above-mentioned companies have issued fourth-quarter warnings. In fact, Oracle handily beat estimates for its latest quarter, in part by showing impressive growth in its e-business applications business. Clarus (CLRS), which sells software that competes with Ariba and Commerce One, did issue a warning two weeks ago that fourth-quarter sales and net loss would be higher than analyst expectations. Wall Street rumors have circulated about a possible slowdown in sales at both Ariba and Commerce One over the last three months, but executives at both companies have insisted that sales goals are being met, if not exceeded. Still, b-to-b stocks are in a severe slump, fueled by a handful of analyst downgrades. David Mahoney of Wit Soundview downgraded both Commerce One and Ariba in late November, raising questions about the companies' ability to fulfill all the b-to-b needs of their customers. And Patrick Walravens of Lehman Brothers didn't do Ariba any favors in mid-December when he initiated coverage with a "neutral" rating. Commerce One stung On Wednesday, Robert Schwartz of Thomas Weisel Partners took his turn at the whipping post, stinging Commerce One with a report that questioned the company's ability to win customer orders for direct procurement software -- or software that helps companies buy the goods needed in the manufacturing process. (See "Commerce One sinks on customer loss") The report, which downgraded Commerce One to a "market perform" from a "buy," was issued after Commerce One lost a large b-to-b marketplace account to VerticalNet. Thomas Berquist of Goldman Sachs, referring to the same lost account, said Wednesday that Commerce One could have a tougher time meeting or exceeding estimates next year. He did not downgrade the stock. Other b-to-b stocks hit that have issued warnings or have been hit with analyst downgrades include b-to-b marketplace operators VerticalNet (VERT), SciQuest (SQST) and Ventro (VNTR), and b-to-b incubator Internet Capital Group (ICGE).