"Dana Blankenhorn" firstname.lastname@example.org
Date: Tue, May 16, 2000 10:56 AM
Subject: Comment for B2B Exchange - From a-clue.com, May 22, 2000
Exchanges vs. Vendors
The keys to a successful marketplace are liquidity and transparency. These two values are related. Lots of players with lots of money provide liquidity. But strict rules " especially on conflict-of-interest " rigidly enforced provide transparency. The more rigidly exchanges enforce their own rules, the less rigidly government has to.
Over the last two years hundreds of b2b exchanges have sprung up based on the promise of transparency. Over the last few months dozens of major buyers in major industries have built competing exchanges, withholding their liquidity (http://www.infoworld.com/cgi-bin/deleteframe.pl?story=/articles/hn/xml/00/05/15/000515hnexchange.xml) and leaving several exchanges stillborn.
Exchanges will not succeed unless they have both liquidity and transparency. The vendor-driven "exchanges" built by auto makers, hotelkeepers, and others are nothing of the kind. They can accept regulation (governmental or otherwise) and become exchanges, or the exchange movement may die. Here's where our Department of Commerce can use some State Department skills. Negotiate first, and regulate only if necessary. (But be aware it could become necessary.) That's my message for the FTC (http://www.ftc.gov/opa/2000/05/b2bworkshop.htm).