It's taken a long time, but the B2B industry is finally realizing that it's the B of business trading that's important and that "netmarkets" are just one way of achieving that. Along the way we've discovered that the many to many hub, usually with dynamic pricing, only works in a few specialized areas. Those areas are exactly the situations predicted where the product is a commodity and/or price is relatively unknown. Some typical examples might be pork bellies or distressed/surplus stock. These are exactly the markets where trading floors or auctions existed in the real world. eBay has shown that this trade can be take on line successfully and it seems a reasonable bet that eBay will subsume most of the other online auctions. Incidentally, people often question whether eBay is B2B. While it's mainly C2C, I'd love to see some figures for the total B2B trade on eBay. I think it's substantial and probably dwarfs most other B2B projects.
Now the economists use the term "Marketplace" to refer to large sections of an economy, but we have used it along with "Exchange" to refer specifically to a many to many hub that brings both buyers and sellers together to trade with each other. This is roughly analogeous to the farmer's market, market square or trading floor where traders come together to buy and sell. But as this didn't work that well in the general case, and with the large buyer push for e-procurement, we're seeing a development of B2B models centred on a single large player aimed at improving their supply chain. Unfortunately some commentators started calling this a "Private Market", "Private Exchange" and similar names. And yet, there was rarely any intention of allowing the suppliers to trade with each other over the system. The flaw in this approach is exposed when you ask what happens when the hubs and spokes start to trade with each other. You very quickly switch to a network or web model. So now several groups are beginning to talk about "Private Trading Networks", "Value Webs" or "Value Nets".
So just like many other systems on the internet, we have a big mix of clients, servers, individuals and organizations connected together by more or less permanent point to point links. This is not that dis- similar from EDI and it should be possible to learn many lessons from it. But EDI has a lot of hard coding involved and is relatively inflexible, so the individual links really are point to point and not easily switched from one end point to another. This time around we should be able to make the solutions much more general so that building a new link between two organizations is trivial and possibly even automatic. I think the big challenge for the software vendors in this area is now to come up with software that exploits the cheap communication and deployment of the internet, but in a way that includes all the players, not just the largest. And to do it in a way that doesn't require a vast army of developers, contractors and consultants to implement. This is a vision of de-centralization on a massive scale where organizations are peers, regardless of their size.
There's a huge implication of this approach involving distributed catalogues but we'll leave that for another day!
Related links:-
Size shouldn't matter
One to One B2B
EBay: The definitive online marketplace
[ << The End of the Hub ] [ UDDI Scenarios >> ]
[ 0 comments ] [ G ] [ # ]
Now the economists use the term "Marketplace" to refer to large sections of an economy, but we have used it along with "Exchange" to refer specifically to a many to many hub that brings both buyers and sellers together to trade with each other. This is roughly analogeous to the farmer's market, market square or trading floor where traders come together to buy and sell. But as this didn't work that well in the general case, and with the large buyer push for e-procurement, we're seeing a development of B2B models centred on a single large player aimed at improving their supply chain. Unfortunately some commentators started calling this a "Private Market", "Private Exchange" and similar names. And yet, there was rarely any intention of allowing the suppliers to trade with each other over the system. The flaw in this approach is exposed when you ask what happens when the hubs and spokes start to trade with each other. You very quickly switch to a network or web model. So now several groups are beginning to talk about "Private Trading Networks", "Value Webs" or "Value Nets".
So just like many other systems on the internet, we have a big mix of clients, servers, individuals and organizations connected together by more or less permanent point to point links. This is not that dis- similar from EDI and it should be possible to learn many lessons from it. But EDI has a lot of hard coding involved and is relatively inflexible, so the individual links really are point to point and not easily switched from one end point to another. This time around we should be able to make the solutions much more general so that building a new link between two organizations is trivial and possibly even automatic. I think the big challenge for the software vendors in this area is now to come up with software that exploits the cheap communication and deployment of the internet, but in a way that includes all the players, not just the largest. And to do it in a way that doesn't require a vast army of developers, contractors and consultants to implement. This is a vision of de-centralization on a massive scale where organizations are peers, regardless of their size.
There's a huge implication of this approach involving distributed catalogues but we'll leave that for another day!
Related links:-
Size shouldn't matter
One to One B2B
EBay: The definitive online marketplace
[ << The End of the Hub ] [ UDDI Scenarios >> ]
[ 0 comments ] [ G ] [ # ]