IBM, Ariba, i2 Form E-Commerce Alliance

FRAMINGHAM (03/10/2000) - If IBM Corp., Ariba Inc. and i2 Technologies Inc. can work together, their new technology alliance may help companies set up Web marketplaces faster and easier, according to industry analysts.

The three companies announced this week that they will share their software and technologies to offer a complete package of business-to-business e-commerce services.

Current customers of the three companies said the alliance is promising.

Tim Lambeth, vice president of global processes at Greensboro, N.C.-based VF Corp., said the shared resources of the companies will allow the apparel manufacturer to improve its business-to-business e-commerce processes faster.

"We have targeted over $200 million to take out of our cost structure over the next three years. With this alliance, we really believe we can speed up that process," he said.

"This is a big step forward in the development of e-commerce," said Ed Gilligan, president of corporate services at American Express Co. in New York, which is already working with Mountain View, Calif.-based Ariba to develop e-commerce payment tools.

But analysts questioned whether the three vendors can work together in harmony.

It "could accelerate the time to market for some of these exchanges," said analyst Vernon Keenan, founder of Keenan Vision Inc. in San Francisco. "[But] a lot of times, these relationships don't blossom."

Adrian Gonzalez, an analyst at ARC Advisory Group Inc. in Dedham, Mass., said the alliance holds promise because of the strengths of the three companies.

Ariba's procurement expertise, i2's networking and logistics capabilities and IBM's hosting, hardware and other technologies make a good fit, he said.

"You've got three big B-to-B hitters here offering different things to the mix," Gonzalez said. "[But] if you get three big heads in a small room, the chances of bumping and bruising heads increases."

The alliance will integrate Irving, Texas-based i2's TradeMatrix marketplace software and Ariba's business-to-business e-commerce software with IBM's WebSphere Commerce Suite software and other technologies. IBM will also use its IBM Global Services professional services unit to support and sell the new services.

IBM also said it will use the technologies to build its own worldwide procurement marketplace to handle purchases from its 13,000 suppliers.

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