InformationWeek: The Business Value of Technology

Among the key products scheduled for the first half of the year are Microsoft's Windows 2000 operating system; databases with improved analytical tools and support for the Extensible Markup Language; integration servers for fostering communications among different applications running on different platforms; messaging tools with XML support; and application suites that link the front and back offices. The E-commerce marketplace will see the evolution of procurement software and services and the integration of personalization software with call centers and customer-relationship management technologies.

With Windows 2000, due Feb. 17, Microsoft will introduce capabilities to add more servers to an application and improve the operating system's ability to handle more CPUs within one server. Windows 2000 integrates network load balancing across 32 nodes in the Advanced Server edition, which is designed to run E-commerce applications. AT midyear, Microsoft plans to ship AppCenter Server, for component load balancing; it's "the first step in making Windows 2000 viable for any kind of E-business application," says Bob Guilbert, director of NT product management at Data General.

Microsoft's ambitious internet strategy—dubbed Windows DNA 2000, for distributed Internet architecture--is built on Windows 2000. Windows DNA 2000 encompasses new versions of SQL Server, Commerce Server, SNA Server, and Visual Studio, and includes BizTalk Server for exchanging XML documents between companies. The aim is to let companies create E-business applications that call on billing, authentication, and other services from the Web, much as client-server systems call on local routines.

The strategy resonates with some customers. "Internet commerce is a low-margin business, so the question I asked was, from a cost perspective, where can I do it best?" says Greg Jones, chairman and CEO of Ubid Inc., an online auction company. Jones says he looked at Windows 2000 because it's a scalable platform and it's easier to find developers who have knowledge of Windows. "Microsoft added up to be a better solution for us," says Jones.

Still, Microsoft is finally facing some competition--and from an unlikely source: Linux. "It's fair to characterize Microsoft's attitude toward Linux as frustration and astonishment that corporate customers are willing to trust and invest in an operating system that doesn't have an identifiable company backing it," says Dwight Davis, an analyst at Summit Strategies.

Linux is being used mainly for single-function Web or cache servers; as companies serve up dynamic pages for E-business applications, though, that function is more critical, Davis notes. The support of vendors such as IBM and Oracle, which are porting their back-office applications to the platform, is helping Linux slowly gain ground as an operating system for data center servers.

Microsoft has been busy enhancing its products to take advantage of Windows 2000. Its Exchange 2000 Server, due by midyear, features a Web Store database that addresses each message, calendar entry, and document in an Exchange folder with an Internet protocol call, instead of a proprietary call. That makes Exchange competitive with Lotus Development's Domino as a platform for delivering data to employees and business partners via a Web browser, say customers and analysts.

Microsoft's SQL Server 2000, also due midyear, can save field types as XML strings to facilitate data interchange for E-business. It will also have four-node failover capabilities, the ability to use 64 Gbytes of RAM for processing, and links to Windows 2000 Active Directory services for database administration.

Microsoft will face stiff competition in the database market from Oracle, which is scheduled to deliver a new version of its database in the first quarter. Oracle8i 2 is expected to offer built-in analytical capabilities that now require an analytical-processing server, as well as support for the latest Java standards and an XML parser that converts XML data into a form the Oracle database can understand.

Database vendors will also introduce data and content integration products, with the goal of making it easier for companies to locate and share information scattered across heterogeneous systems. In the first quarter, Oracle will ship its Oracle Integration Server, which will use XML and Java to integrate data from enterprise resource planning and CRM applications, E-commerce systems, messaging middleware, and databases. IBM plans to introduce a content-management server that combines document, Web-content, and media-asset management capabilities from existing products.

IBM is tight-lipped about the next release of its DB2 Universal Database, due in the first half. But the new system is rumored to have enhancements for E-commerce and improved online transaction-processing performance, as well as business intelligence and complex query capabilities. IBM plans to incorporate data integration technology from its Data Joiner product into DB2.

The leading server and storage vendors are gearing up new products that will provide the storage for the vast amounts of data companies collect via their E-business sites. During the first half of 2000, look for EMC Corp. to extend its lead regarding intelligence for enterprise storage area networks. EMC's Symmetrix storage system will get boosts in capacity and performance. Enhanced EMC software will increase customers' ability to run their businesses online, all the time.

In the most recent example of a key E-business trend—the convergence of Web-based procurement applications and online industrial marketplaces-- Ariba Inc. expects to close its $1.9 billion acquisition of trade Technologies Inc. in the first half of the year. The deal marries trade, the leading provider of tools for vertical marketplaces such as Chemed, with one of the pioneers of software for large companies to move procurement to the Web. But Ariba, like most procurement software vendors, has been moving to a services model that offers browser-accessible "trading hubs" where companies can find suppliers or participate in online auctions.

E-commerce vendor BroadVision Inc. will spend the first half of 2000 tightening integration between its Web personalization system, BroadVision One-to-One, and an array of third-party software, including call center and CRM packages from vendors such as Oracle, Pegasystems, and Siebel Systems. "Our customers are saying it's absolutely critical for them to have one view of their customers," says Sandra Vaughan, BroadVision's VP of marketing. BroadVision also plans to release version 5.0 of its One-to-One system, featuring tighter integration with Java and support for XML, Vaughan says.

Siebel is expected to add Web-personalization technology from BroadVision, with which Siebel created a partnership in November, to its flagship Siebel 2000 CRM suite, expected to ship at the end of the first quarter. Rittenhouse Financial Services, which provides services that brokerages resell to their customers, plans to use information stored in its CRM application and Siebel 2000's new personalization tools to create Web pages tailored to the preferences of financial advisers. "We can take all of the contacts that we have with them [through traditional channels] and use it to jump-start their Internet experience," says Bill Crager, managing director of marketing for the Radnor, Pa., company.

Blue Martini Software will begin shipping the third version of its Blue Martini Customer Interaction System, a framework with which the company intends to provide Internet applications that can easily be integrated with a multitude of packaged applications, from CRM tools to ERP systems. For example, the new TeleConnect Module will let call-center and customer-service representatives become more directly involved in the marketing and selling of a company's products and services. It will initially work with Siebel Systems' call center software and will eventually support Siebel's CRM software as well as CRM and call center products from other vendors, the company says.

In the spring, Blue Martini will begin shipping the Customer Collaboration Module, a new feature designed to help E-commerce sites offer more interactive experiences to their customers. For example, the module will let two customers link their Web browsers and shop a site together; it will also let customer-service reps walk customers through a site. E-retailers can also use the module to provide live assistants on their sites to personally help customers shop.

Established software players such as SAP, Oracle, and PeopleSoft are moving to online marketplaces. By mid-year, SAP expects to launch its own online exchanges for the global chemical and pharmaceutical industries and PeopleSoft (along with Commerce One Inc.) will provide software for the Apparel Buying Network to be launched by Guess Inc.

SAP is expected to launch more components for mySAP.com, the Internet version of R/3, including the marketing management component of its CRM suite. It's expected to integrate information on customer interactions through all channels, including the Web. PeopleSoft will roll out PeopleSoft 8, the next version of its application suite, in the second quarter. The package will feature a Web-browser interface, or iClient, that promises better application performance and supports a greater volume of transactions as well as more users via the Web than its current Java client. Along with architectural improvements, PeopleSoft 8 will deliver new E-business applications called eBusiness Communities for procurement, self-serve benefits, and travel & expenses.

Enterprise application vendors aim for increased integration with third-party software, too. For example, Oracle Applications 11i, due by the end of the first quarter, links the front and back offices by integrating CRM, ERP, supply-chain, and E-business apps on one database, in one suite. Oracle's Internet Order Management, an addition to the suite due in May, will guide customers through Web purchases and accept orders from Web sites. Once the order is placed, the system will give customers product-arrival information and move the order into supply chain planning and logistics applications.

Order management is critical for Specialized Bicycles Inc., which handles orders for more than 1 million items annually. In the past, the company's IT department had to manually connect Oracle's order-entry app to its back-end ERP and supply-chain systems. "I didn't like the fact that it took that level of effort to maintain a connection," says Ron Pollard, CIO of the San Jose, Calif., company. Pollard says the Order Management product will connect directly to Specialized Bicycles' Oracle iStore and simplify links to business partners, including bicycle dealers and distributors.

Integration and E-business capacity are the two themes that will carry through the first half of the new year—much to the relief of most IT managers.

Illustration by Gary Parker