© 2001 Jupiter MMXI Jupiter The Global B2B Arena James MacAonghus Analyst, Jupiter MMXI

© 2001 Jupiter MMXI Jupiter Agenda The Heavyweights: Industry Sponsored MarketsThe Heavyweights: Industry Sponsored Markets The State of TechnologyThe State of Technology Early Days in EuropeEarly Days in Europe

© 2001 Jupiter MMXI Jupiter The Heavyweights: Industry Sponsored Marketplaces

© 2001 Jupiter MMXI Jupiter ISM Progress Should Follow Key Steps 1.Establish leadership 2.Form a separate legal entity 3.Establish a capital structure 4.Select a technology vendor 5.Create business and revenue models Page 3 of 22

© 2001 Jupiter MMXI Jupiter ISMs Make Significant Progress Towards Live Transactions Page 4 of 22

© 2001 Jupiter MMXI Jupiter ISMs Exhibit Stunning Speed; 74 Percent to Go Live by Year’s End Source: Jupiter Research (10/00); n=63 (US only) Page 5 of 22

© 2001 Jupiter MMXI Jupiter ISMs Seek Efficient Supply Chains, Not Lower Prices or Broader Reach Online collaboration is a key goalOnline collaboration is a key goal Back-office integration requiredBack-office integration required Marketplaces provide single connection to multiple trading partnersMarketplaces provide single connection to multiple trading partners Chain-wide visibilityChain-wide visibility Anti-trust issuesAnti-trust issues Page 6 of 22

© 2001 Jupiter MMXI Jupiter Supply-Chain Efficiency vs. Cost Savings as Value Propositions Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Value Propositions Supply-Chain Efficiencies Procurement Efficiencies Expanded Customer and Market Reach Cost Savings Save Time Community/Relationships Better Pricing Percentage of Respondents Page 7 of 22

© 2001 Jupiter MMXI Jupiter Incumbents Felt They Alone Could Drive Liquidity to Net Markets Internal Drivers Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Percentage of Respondents Page 8 of 22

© 2001 Jupiter MMXI Jupiter Ariba Fared Best in Signing Deals to Provide Technology to ISMs Source: Jupiter ISM Executive Survey (10/00), n=30 (US only) Page 9 of 22

© 2001 Jupiter MMXI Jupiter The State of Technology

© 2001 Jupiter MMXI Jupiter Integration Cost a Major Issue Source: Jupiter Research (10/00); n=63, (US only) Page 11 of 22

© 2001 Jupiter MMXI Jupiter Cost of Net Markets – Higher US Costs Reflect Greater Maturity … Source: Jupiter Research (10/00); n=63, (US only) Page 12 of 22

© 2001 Jupiter MMXI Jupiter … in Europe, Custom Way More Common Than Package Software Page 13 of 22

© 2001 Jupiter MMXI Jupiter Functionality Needs Depend On Buyer’s Relationship With Seller Buying From Existing Suppliers Informational over transactionalInformational over transactional Fewer deals per participantFewer deals per participant Better for commodities than custom goods due to complexity of purchaseBetter for commodities than custom goods due to complexity of purchase Catalogue technologyCatalogue technology Search technologySearch technology Transactional over informationalTransactional over informational Lots of deals per participantLots of deals per participant Purchases often supplier - specific due to performance requirementsPurchases often supplier - specific due to performance requirements Data miningData mining Product/order manipulationProduct/order manipulation Buyer Need Buying From New Suppliers Buyer Market Source: Jupiter Research Page 14 of 22

© 2001 Jupiter MMXI Jupiter Faint Glimpses of Online Collaboration Developer Community - CatapulseDeveloper Community - Catapulse Planning, Forecasting, Restocking - i2, AribaPlanning, Forecasting, Restocking - i2, Ariba Cross-industry - NooshCross-industry - Noosh Inter-department – MercataInter-department – Mercata Vendors - i2, OpenText, Catapulse, Manugistics, Adaxa, Exterprise, Agile Page 15 of 22

© 2001 Jupiter MMXI Jupiter Integrators / ASPs Serve Different Audiences Evaluate specifically against requirementsEvaluate specifically against requirements Lean, mature vendor management teamLean, mature vendor management team Brick and mortars – avoid ASPs nowBrick and mortars – avoid ASPs now ASPs – focus on race for ERP, CRM, SMEsASPs – focus on race for ERP, CRM, SMEs Page 16 of 22

© 2001 Jupiter MMXI Jupiter Early Days in Europe

© 2001 Jupiter MMXI Jupiter Many Clamour For Attention Industry # net markets Aerospace7 Agriculture44 Chemicals24 Computer/Telecom13 Construction29 Consumer Goods 6 Electronics3 Oil/Gas13 Food10 Industrial Supplies 36 Metals and Mining 16 Motor Industry 4 Paper and Office 15 Pharmaceutical18 Transportation/Freight28 Utilities4 Page 18 of 22

© 2001 Jupiter MMXI Jupiter Net Markets Not Yet Ready for Action Page 19 of 22

© 2001 Jupiter MMXI Jupiter Early Value Added Services Complete Transaction Process Source: Jupiter Executive Survey (10/00); n=90, (US only) Which of the following features and services do you plan to add in the next 12 months? Percentage of Respondents Page 20 of 22

© 2001 Jupiter MMXI Jupiter Internet Immaturity Remains Main Barrier What are the main barriers to getting a critical mass of participants onto your Net Market? Page 21 of 22

© 2001 Jupiter MMXI Jupiter Treat Small and Medium Enterprises With White Gloves What size companies are you targeting? Page 22 of 22

© 2001 Jupiter MMXI Jupiter Thank you

© 2001 Jupiter MMXI Jupiter The Biggest Market Exists for Enabling Partners to Trade Online Buying From New Suppliers Buying From Existing Suppliers OwnTransaction FacilitateTransaction Buyer Market Role for New Online Entity Big Market $$$ Huge Market $$$$$ Medium-to-SmallMarket$ Does Not Exist Source: Jupiter Research