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Commerce One touts new "collaboration" software

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CIOL Bureau
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Siobhan Kennedy

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NEW YORK: Commerce One Inc., seeking to boost its stake in the hotly

contested business-to-business commerce sector, this week announced new software

which it said enables corporate buyers to work with suppliers without having to

pay fees to online marketplaces.

Commerce One, which makes marketplace software that brings buyers and

suppliers together over the Web, said its new Collaborative Procurement offering

enables suppliers to bypass marketplaces and send their product catalogs

directly to customers.

"In the past, customers either had to download product catalogs over the

Web or connect directly to the suppliers' web site," said Steve Viarengo,

Commerce One's director of solutions strategy.

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Viarengo said the new offering - which combines Commerce One's procurement

software with features from its core marketplace technology - lets buyers store

suppliers' catalog data on their own network and conduct the transaction with

the supplier privately.

"It bypasses the need to go to an outside marketplace," Viarengo

said. He added that the new offering was not intended to replace Commerce One's

full-blown marketplace platform, MarketSet, developed in conjunction with German

software giant SAP AG. That software also includes such features as auctions and

payment services, plus the ability to connect to back office planning,

manufacturing and logistics applications, Variengo said.

"Grandiose visions"



"This is a reflection of where we see B2B going in the coming years,"
Rick Villars, an analyst with industry research firm International Data Corp

said. "With a little less grandiose visions for industries and a lot more

practical implementation at a company level."

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Joshua Greenbaum, principal of Daly City, California-based Enterprise

Applications Consulting said Commerce One was following the trend in the B2B

industry by adopting the term "collaborative" to describe its

software. "The real problem is that procurement on its own is not a

particularly sexy term right now, and collaboration is," Greenbaum said.

Niche markets shrinking



Companies like Commerce One and rival Ariba Inc. burst onto the scene
touting products that let companies use software to buy goods over the Web

rather than waste time and money using paper, pens and fax machines.

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But over the last year, those firms have seen their share prices tumble as

the flagging economy and a slowdown in high-tech spending have taken their toll

on the once high-flying B-to-B sector. In addition, those B2B marketplaces have

been very slow to take off. Suppliers are reluctant get on board, and without

goods to buy, customers have been few and far between.

Now analysts are predicting that the market for niche players, like Ariba, is

shrinking, as customers look to bigger software vendors, such as Oracle Corp.,

to buy all their software products in one go. "They have to find ways to

package this functionality so that it will be palatable to users,"

Greenbaum said. "They have to move it upstream beyond just the commodity

view of procurement."

By doing so, Villars said Commerce One will also help encourage buyers to get

more suppliers on board. "In some ways it's an acknowledgment that the big

buyers are going to have to do something to bring their suppliers on line,"

Villars said.

(C) Reuters Limited 2001.

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