From Competition to Consensus

The attraction of this ultimate vision was that all the participants would be able to use their existing information technology infrastructure to communicate with the hub, eliminating the need for investments in costly point-to-point integration with multiple partners while providing convenient access for the retailers to all the manufacturers through one portal.

Great concept, but various cultural and technical obstacles had already torpedoed efforts to build such hubs under the banner of e-marketplaces in the late 1990s and 2000. First, what would motivate numerous competitors to sit down at the table together and, ultimately, participate in a venture that would have their confidential data flying back and forth through a shared hub?

Marie offers a simple answer to that question: "Pressure from the customer was the main driver. Our CEOs quickly realized that we could continue fragmented and without any consensus, but at the end of the day we would reach a deadlock one way or another in terms of our customers."

But Marie goes on to note that once the manufacturers' chief executives had accepted the shared hub concept, the process of driving the initiative forward was facilitated by the appointment of a management team for the project that included technical leadership from each of the participating companies, including Marie and Minacci, as well as Michael Steinborn, head of e-commerce management for BSH; and, eventually, Mauro Viacava, chief information officer for Merloni; and Karel Van Der Horst, head of e-commerce at Philips.

On the technical side, the challenge was to establish a platform that could play nice with the various front- and back-end systems in use at the manufacturers and their distributor and retailer customers, while also providing for real-time messaging. Another requirement: the ability to guarantee that the information passed through the hub would be secure, in part to satisfy any participant concerns over confidentiality but also to comply with European Union antitrust regulations. And the founding manufacturers set the goal of finding a cost-effective technology solution they could get up and running quickly.

Criteria for a Provider

Adding up all these requirements, the Tradeplace management team elected to seek an independent solution provider experienced in real-time XML integration for connecting heterogeneous systems.

In addition, Tradeplace sought a provider that could offer an application service provider (ASP) model, which would eliminate the need for the manufacturers — as well as their customers — to make major investments in IT infrastructure and reduce the necessary initial funding for the project. An ASP model also would offer the opportunity, Tradeplace believed, to get their model up and running quickly, since it would presumably leverage existing infrastructure in place at the solution provider.

After scouting out potential technology providers, the Tradeplace team tapped Hubspan, a Seattle-based company founded in June 2000 with expertise in outside-the-firewall integration, to connect multiple trading partners through a single point of integration. Marie said the CEOs of Tradeplace's manufacturer members initially expressed a certain degree of skepticism about using a non-European provider due to response time and data traffic issues, "but we were able to demonstrate that Hubspan was the right partner, with the most experience in the market and with the best quality-price ratio."

Hubspan worked with the Europeans to set up the Tradeplace Message Hub (TMH) as the joint services platform for the exchange of both real-time (synchronous) and store-and-forward (asynchronous) business processes between Tradeplace members and their customers.

The provider brought its machine-to-machine and portal-based integration tools to the table, along with its network services and transaction processing infrastructure. In addition, at the outset of the project Hubspan participated with the manufacturers in a weeklong forum in Milan that brought together the IT thought-leaders from each company to work out a common XML-based language that would be unique to the hub.
The result, called TradeXML, is a stripped-down, verticalized version of the XML language to meet the specific needs of the appliances industry (including, for example, a common set of design specs for a "washing machine") and to correspond to the types of real-time transactions that Tradeplace was created to support (such as price checking and inventory availability).