The great B2B shootout

IBM, Sun, Oracle and dozens of other companies are all gunning to become the back-end platform provider of choice

Business-to-business infrastructure may not sound very glamorous, but the software industry's biggest providers are all furiously vying for a piece of the business.

As the saying goes, whoever controls the platform controls the customer. And no slice of the B2B market seems more appealing to software companies than the back-end platforms that vertical industry consortia and their members companies use to build exchanges -- the marketplaces that link customers and suppliers.

Gartner Group estimates that as many as 10,000 B2B exchanges could be live by 2003. The forecast is that B2B e-businesses, including exchanges, the providers of the exchange-enabling software and the services firms helping to install and maintain those offerings, will grow into a $7.29tr industry by 2004.

In the past two days, the B2B exchange infrastructure announcements have come fast and furious with initiatives from IBM, the Sun/Netscape iPlanet alliance, Oracle and Novell.

IBM announced on Tuesday new wireless capabilities and features for its WebSphere Commerce Server Marketplace Edition product, a product not due to ship until September, first on the RS/6000 Unix system. Also on Tuesday, the iPlanet alliance unveiled its MarketMaker offering, which also won't ship until the fall on Solaris and later this year on Windows NT, Windows 2000, HP-UX and IBM's AIX. Oracle took the wraps off more of its B2B exchange foundation technology on Monday, when it rolled out the details on Oracle Branded Exchange (no relation to Microsoft Exchange), a customizable version of its B2B Exchange product that it will sell using a franchise model.

iPlanet was quick to highlight the fact that it isn't offering B2B services; it is looking to third-party partners to do that.

"We believe there's a need for someone to provide business model flexibility," said Frederic Bonnard, director of product marketing with iPlanet. "That's why we, a maker of software, are helping market makers customise the remaining 50 percent of our product for their verticals. We don't want to be the market maker ourselves, or to provide the related services."

But IBM and Oracle emphasised the hosting, support, maintenance and other consulting services they are offering to help businesses bring their exchanges online more quickly and easily. And Novell on Tuesday added its two cents to the debate, by rolling out a beta version of its XML Integration Services, a complement to Novell's iChain network software that links suppliers, sellers and customers.

Large software makers don't have the B2B infrastructure market locked up, despite their size and strength in providing traditional back-office building blocks. CommerceOne, Ariba, i2, Breakaway Solutions, Broadvision and a host of other smaller software and services vendors tend to be further ahead, in terms of tangible deliverables, than are the bigger software firms.

Breakaway Solutions, for example, announced on Monday a rapid-launch program, called MarketMover, for customers interested in building B2B marketplaces. Breakaway integrates platforms from various third-party vendors via XML and messaging interfaces, and provides users with a single point of contact for integrating, hosting, administering and maintaining them.

Breakaway counts among its so-called "e-marketplace" customers VerticalNet, eRisks.com, InvestorForce, WorldOil.com and Marex.com.

Whoever ends up as the suppliers and market makers in the emerging B2B exchange space, the proving ground is wide open, all participants agreed.

"So far, there's been lots of press announcements about the big architectures and big exchanges, but not many transactions happening," noted iPlanet's Bonnard. "In the future, expect to see lots of independent marketplaces, connected to lots of niche ones. And for this, you'll need open marketplace (foundations), built on standards."

In addition to demonstrating support for standards, suppliers of B2B infrastructure products will need to prove their scalability and reliability, said International Data Corporation e-commerce research manager Albert Pang.

"To what extent can these offerings scale to run very large projects? No one has demonstrated a line and working process that will prove how these technologies are really going to work," Pang said. "It's one thing to offer the capability to do auctions, but lots of things are missing, like integrated authentication and electronic bill presentment and payment. I'm still skeptical how these products will propel the growth of e-marketplaces."

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