Commerce One Inc., an electronic commerce company distinguished by an unusually long list of partners and allies, announced deals last week with banks north and south of the United States.
Toronto-Dominion Bank said it would rely on Commerce One technology for what is billed as the first business-to-business Internet trading portal in Canada.
Grupo Financiero Banamex-Accival, the largest financial company in Mexico and the parent of Banamex, agreed in principle to form a joint venture with Commerce One to operate an electronic business-to-business marketplace for Latin America.
Commerce One did not stop there. At the end of the week it announced what it called a "strategic distributor partnership" with eMediate, a corporate electronic procurement consortium in South Africa. That organization will play multiple roles, including portal operator and sole Commerce One distributor in that country, working to extend geographically the latter's relationships with Compaq Computer Corp., PeopleSoft Inc., Microsoft Corp., and PricewaterhouseCoopers.
Such efforts are solidifying Walnut Creek, Calif.-based Commerce One's standing as an international force on the rapidly expanding "B-to-B" side of e-commerce. Many industry experts are urging that attention be focused more on this area than on "business-to-consumer" opportunities. In a report released Monday, Deloitte Consulting said that projected B-to-B revenues of $1.3 trillion in 2003 would be six times those in consumer on-line activity.
Boston Consulting Group previewed a study Tuesday in which it concludes that the B-to-B e-commerce market is far larger than commonly estimated.
"Businesses that provide the hard and soft infrastructure to implement these new platforms will grow rapidly as markets proliferate," said Deloitte Consulting principal Cathy Benko. "Those who learn to use this new infrastructure effectively will most certainly gain a decisive competitive advantage in the next century."
In another sign of how rapidly this market is going mainstream and how high the stakes are perceived to be, the "buy side" systems specialist Ariba Inc. of Mountain View, Calif., reached a definitive agreement last week to acquire Tradex Technologies Inc. for $1.86 billion in stock. With the Tradex on-line exchange system, Ariba is reaching from the buy side for "leadership across business-to-business e-commerce, period," said Ariba chairman and chief executive officer Keith Krach.
This week Signio Inc., a payment-platform company that has alliances with Commerce One and others in both business-to-business and business-to-consumer commerce, agreed to be acquired by the digital certificate company Verisign Inc. for $700 million-plus in stock.
Commerce One was founded in 1994, has operated under its current name since 1997, and had early backing from SAP of Germany. Now publicly held, it made major leaps this year with its application of the XML, or eXtensible Markup Language, compatibility with Microsoft's BizTalk and various other e-commerce frameworks and standards, and a long and growing list of customers and strategic allies.
Commerce One's main offering consists of BuySite for internal corporate procurement functions and MarketSite for interactions with suppliers, ranging from order placement to payments.
Both of Commerce One's new banking partners are leaders in their respective markets in the development and delivery of on-line services.
Toronto-Dominion, which has more than a million on-line customer accounts and is affiliated with the discount brokerage TD Waterhouse Group, will bring Commerce One into Canada through a cobranded portal, TD MarketSite.
This will "complement our traditional role of financial services provider" by offering to current and potential clients "new business-to-business e-commerce services," said Toronto-Dominion chairman and chief executive officer A. Charles Baillie. He called the relationship "a major new development in Canada's burgeoning e-commerce sector and specifically in business-to-business."
The bank itself expects to cut its internal procurement costs. It expects to begin using MarketSite in March, opening it up to customers, suppliers, and others on the outside by June.
The sponsors said that the linking of large numbers of buyers and sellers into a real-time trading community will increase efficiencies and lower prices for all. Connections with other MarketSite portals around the world would enhance the "network effect," the benefits increasing as more and more participants gain access.
"We believe that Commerce One's leadership in electronic commerce coupled with TD's position as the most innovative of Canadian banks will enable us to together deliver comprehensive procurement solutions with superior customer support and service," said Mark Hoffman, Commerce One's president and CEO.
With Banamex-Accival, known as Banacci, the aim is "to quickly deliver a series of regional trading portals and provide superior levels of customer support and service," Mr. Hoffman said.
Banacci and Commerce One said they expect to complete definitive agreements by Dec. 31 to proceed with their joint venture. The new company would rely on MarketSite for a Mexican B-to-B portal serving, among others, Banamex's corporate customers. Others would follow, starting in Argentina, Brazil, and Chile as "strategic partnerships with regional market makers."
The transaction is expected to include a purchase by Banacci of up to 1.5 million Commerce One shares at a pre-split price of $348.44 each - $523 million in total - in exchange for the right to receive shares in the new company when issued and listed on an exchange.
Banamex chairman and CEO Roberto Hernandez said the joint venture "is a major element of Banacci's Internet strategy." Having "a privileged position in the payments system of the country," he added, Banacci has "a unique opportunity to develop e-commerce in Mexico and other Latin American countries."
The Commerce One networking chain around the world also includes British Telecommunications, NTT Communications in Japan, Cable & Wireless Optus in Australia, and SESAMi.com in Southeast Asia. Commerce One, which operates the U.S. MarketSite portal itself, is working with General Motors Corp. to launch GM TradeXchange, an auto industry supply-chain network competing with a concept that Oracle Corp. and Ford Motor Co. are promoting.
GM buyers began making purchases this week using TradeXchange's catalogue function, and a "first-ever Internet business-to-business auction" took place last Friday, Commerce One said.