SAN MATEO (04/03/2000) - AS BUSINESS-TO-BUSINESS trading exchanges proliferate, the speed of integrating business systems into one or several networks is fast becoming a crucial issue for suppliers looking to broaden their potential customer base without rewiring their procurement systems.
"Buyers and sellers wish to have flexibility in which exchanges they work with.
Exchange members are wary of being locked in to a particular exchange," said Vernon Keenan, an analyst at Keenan Vision.
To this end, trading exchange vendors and members are working on integration technology and standards, largely based on XML, to enable faster time to market and "market-to-market" connections among various exchanges.
Next week EAI (enterprise application integration) vendor Mercator will release B2B Square, which, combined with its availability of Mercator Commerce Broker, would enable businesses to utilize any number of exchanges -- whether in EDI (electronic data interchange), the various flavors of XML, or even SWIFT, a common banking standard. The platform can enable exchanges to interoperate with one another, said Dave Power, vice president of marketing at Mercator.
Start-up Ironside this week will launch a transaction exchange, enabling sellers to make one integration and plug in to trading exchanges on a subscription basis, widening the field for market-to-market initiatives.
And the Open Applications Group (OAG) is working with webMethods, whose XML-based interoperability software links exchange platforms, to create standards for e-businesses to communicate. Ford and OAG recently issued a vendor challenge to test OAG standards for interoperable e-commerce solutions.
While most exchanges already target the buyer, offering competition based on pricing, multiple exchange channels will most help the seller, Keenan said.
"Clearly there's a big seller advantage [in being able to plug in to various exchanges] ... It offers increased distribution and better customer acquisition for sellers. If it's easy to work with different exchanges, then they're going to be able to increase their distribution much more quickly," Keenan said.
According to Derek Smyth, COO of Ironside, many companies are expected to do business with at least four different exchanges next year. Smyth said that Ironside's network will evolve, offering services such as analysis of each exchange, including transaction volume, customized for the e-business later this year.
By providing the underlying XML glue for many exchanges, such as Ariba, Commerce One, mySAP.com, Ventro, and Chemconnect, webMethods is also enabling many of them to interoperate.
"WebMethods is the bridge between applications like Commerce One, Ariba, and others and companies' back-end legacy systems," said Anna Kerr, a senior analyst at IDC.
Because each exchange relies on webMethods to connect its back-end systems, it presents a unique opportunity for webMethods to let companies interoperate with many exchanges, said Charles Allen, co-founder and vice president of product marketing at webMethods.
Although both Ironside and webMethods provide XML-based solutions, the very flexibility of XML is what creates the interoperable problems, according to OAG architect Michael Rowell.
"XML is also so flexible that I can define my tags, and you can define your tags, but when I pass you my message, you don't know how to read it -- you understand the structure, but you don't necessarily know what my tags mean," Rowell said.
Interoperability between exchanges, a fundamental of any market-to-market initiative, will insure the flexibility of channels that sellers and buyers seek.
"This [interoperability] allows for free trade, whatever fits my needs best at the moment," Rowell said.webMethods Inc., in Fairfax, Va., is at www.openapplications.org. Ironside Technologies Inc., in Pleasanton, Calif., is at www.ironside.com.
Exchange of ideas
webMethods, Ironside, and Mercator each have different approaches.
* webMethods: XML bridge between companies such as Commerce One, Ariba, VerticalNet SAP, Ventro, and back-end systems, allowing these exchanges to connect* Ironside: Plugs in to any exchange on a subscription basis or Ironworks 4.0; also XML based* Mercator: Plugs e-businesses into exchanges, also allows exchanges to connect to one another.