To: D. K. G. who wrote (12 ) 6/6/1999 12:32:00 PM From: William F. Wager, Jr. Read Replies (1) | Respond to of 2110
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