Web-EDI Solutions Are Doomed, Says Forrester

[London, ENGLAND] The Web is displacing legacy B2B
transaction technology Electronic Data Interchange (EDI),
says research firm Forrester — and hybrid Web-EDI
solutions will not survive either.

Forrester spoke with 40 managers handling EDI activity
at large European businesses, and found that a lot
of them are putting their faith in hybrid Web-EDI
systems.

Yet Forrester says that EDI trade will peak at
1.5 trillion euros (US $1.3 trillion) in 2002, then
decline as companies switch to the Internet using
industry-specific XML development and e-marketplaces.

“Unlike their peers in the U.S., Europe’s managers
are hoping that hybrid Web-EDI solutions will bring
them the best of both closed EDI and the open Web,”
said Andrew Parker, senior analyst at Forrester’s
European headquarters in Amsterdam.

“But hybrid systems won’t fare better than closed EDI.
Both limited solutions simply won’t compete with
e-business networks based on open Net standards and
business models,” warned Parker.

The pace of change is so fast that many companies
in the fields of logistics, retail, and electronics
are not keeping up with their most aggressive competitors
in developing Internet-based trading solutions.

“New technologies such as ebXML and xCBL will support
flexible transactions in e-business networks to deliver
multistep trading in real-time processes like auctions,
dynamic pricing, and automated substitution selling,” he
said.

“Partners in e-business networks will replace the limited
document exchange of traditional and hybrid EDI with open
collaboration based on sharing not only data but also
business rules.”

Forrester says that by 2005, some of the threatened
companies and those in slow-moving sectors like heavy
engineering will still be conducting just one percent
of their trade in e-markets. To get on track they will
need to hire consultancies and use external services
such as e-commerce integrators and ASPs, says the firm.

The full European EDI 2000 report is available
from Forrester Research in The Netherlands.

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