Franchise secured for e-commerce business

A two-month old Irish company has secured the Irish franchise for global Internet e-commerce company, Commerce One (www

A two-month old Irish company has secured the Irish franchise for global Internet e-commerce company, Commerce One (www.commerceone.com), The Irish Times has learned. It is understood B2B Lution approached US-based Commerce One six months ago to use its technology to establish an online trading and procurement marketplace here. The service is expected to be launched in Ireland. within the next two weeks.

Details of the arrangement have not been disclosed but the move is significant because Commerce One until now has adopted a strategy of partnering with national telecommunications companies when entering new markets. Last week Commerce One signed agreements in Switzerland and Germany to establish business-to-business electronic marketplaces through Swisscom and Deutsche Telekom.

Dublin-based B2B Lution is a spin-off company from Northern Ireland-based, BIC Systems, one of the largest locally-owned IT companies in the region. B2B Lution is understood to be in discussions with major Irish telecommunications companies and banks about forming strategic partnerships, but it plans to retain control of the trading marketplace it develops.

The two founders of B2B Lution are former Trintech employees, Mr Leo Ring and Mr Frank Moroney. BIC Systems has taken a significant shareholding in the company - believed to be around 50 per cent - while the remainder is divided between management and employees.

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Commerce One will appoint a representative to the board shortly - however, it is not a shareholder in the company. Instead, B2B Lution has given it a number of financial revenue commitments.

Commerce One is one of the fastest-growing Internet companies in the US and is currently engaged in a massive marketing battle with competitor Ariba for a slice of the global business-to-business e-commerce market. This week Banc of America Securities upgraded Commerce One's trading status to a "strong buy", setting a share price target of $275 (€274) per share.

Commerce One is building huge online exchanges that connect companies with their partners, suppliers and customers over the Internet, allowing them to conduct a range of activities from purchasing stationery, to ordering the raw materials necessary to make any product from clothing to cars to beer. Forrester Research estimates the business-to-business e-commerce market will be worth $1.3 trillion by 2003.

Organisations have traditionally conducted procurements of scale using electronic data interchange (EDI), but because the Internet is bringing many more companies online it is increasingly important for companies to establish simple transaction standards.

Commerce One this week reported fourth quarter losses of $26.7 million on revenues of $16.9 million compared with $1 million in revenues a year ago.

Madeleine Lyons

Madeleine Lyons

Madeleine Lyons is Food & Drink Editor of The Irish Times