The Pace Quickens

What was the biggest story in data synchronization in 2003? According to Gene Alvarez, a Meta Group analyst, the answer is perfectly clear.

"The Wal-Mart mandate," says Alvarez. "Once they said 'we want things a certain way,' the suppliers who have a significant amount of revenue tied to Wal-Mart really got moving."

Alvarez says that data synchronization was likely to see significant advances regardless of Wal-Mart. But when the world's biggest retailer accelerated the timetable, the biggest suppliers in the retail food chain were quick to fall in line.

"Some weren't too happy about it, obviously," says Alvarez. "Some of them were caught off guard. They didn't have budget for it, possibly."

That said, once the ease and value of data synchronization technology were demonstrated via case studies from early adopters, most suppliers and retailers warmed to the concept.

"From the supplier side, the challenge was getting data together to create the product catalog for synchronization," Alvarez explains. "From the retailer side, it was getting the integration capabilities set up in order to receive the information."

High Stakes

Clearly the stakes remain very high. In a September 2003 note, AMR Research analyst Kara Romanow wrote that $40 billion in savings could eventually be realized through data synchronization. She warned, however, that vendors eager to get a piece of the business may be "causing confusion and clouding the landscape. But with $40 billion in savings at stake, even those early adopters that were first to get data to UCCnet are now going back and considering implementing a sustainable, scalable, ingrained data synch infrastructure... they are unsure where to turn."

Industry Response

To this end, the industry's top vendors moved briskly during 2003, reflecting the level of competition and zeal for innovation within the space. HAHT Commerce rolled out version 7.5 of its Commerce Suite of applications, adding a compliance manager and business intelligence enhancements. As for new clients, beauty products giant Clarins and Central Garden & Pet both tapped HAHT for product information management, while the technologically progressive Mt. Olive Pickle Co. adopted the company's Consumer Products Suite. Another big win came when Xiameter, one of Dow Corning's Web arms, chose HAHT and its Chemicals Suite 7.1 over a host of competitors.

Trigo Technologies focused on growth via expansion and acquisition. In September, the company secured an additional $12 million in financing from Pequot Ventures, Bessemer Venture Partners and several others -- a sign of confidence if ever there were one -- and used the funds to accelerate the development of new products. Earlier in the year, Trigo partnered with collaborative commerce specialist Transora to provide what the companies bill as the most comprehensive product for global data synchronization. And Trigo snared a few of the most coveted clients of the year, signing Albertsons and its 2,300-plus stores.

Sterling Commerce also traveled the expansion/partnership route in 2003. The company, which has traditionally emphasized products for business integration, dove into the burgeoning tech market in China, officially launching its presence there and expanding relationships with around 15 resellers. Stateside, Sterling allied itself with IT supplier Railinc Corp. to provide rail industry clients in North America a range of data management and e-business services. As for new clients, several big-name companies -- Fuji Film, Gerber, Motorola and Shaw's Supermarkets -- signed on to use Sterling's Gentran Integration Suite, which is designed to ease electronic transactions and provide the tech underpinning for future initiatives (RFID et al). Separately, Sterling freed itself to concentrate on technology initiatives by selling its Banking Services Division to Thoma Cressey Equity Partners.

In 2003, Cyclone Commerce introduced a Health and Life Sciences business unit to create business-to-business products that address regulatory compliance and industry initiatives. Given that the company's top clients include nearly everybody in the healthcare food chain -- pharmaceutical manufacturers, distributors, online exchanges and drug store chains --the move was hailed as one that will firm its place as the go-to provider of data synchronization within the healthcare field.

Like Cyclone, QRS Corp. devoted much of the year to new products and product enhancements. In December, the company debuted QRS EDIINT Gateway, a service enabling clients to accommodate large retailers and government agencies demanding data delivery via EDI-over-the-Internet. QRS also launched version 7.0 of its well-regarded Web Forms application, which streamlines the order-to-fulfillment process, while at the same time, assisting smaller vendors in electronic transactions with retailers.

Global eXchange Services (GXS) saw more high-level turnover than most of its competitors in the data synch space, with Gary Greenfield replacing president and chief executive officer Harvey Seegers, who had held the posts for little more than a year. Beyond that, it was business as usual. GXS scored a substantial victory when Gottschalks tapped the firm to be the sole supplier of data synchronization and transaction services for its 65 stores in the Western United States.

SeeBeyond pushed forward with its Integrated Composite Application Network (ICAN) 5.0 suite, unveiling a "can't wait to integrate" marketing campaign credited with driving sales. New clients included two of the country's biggest institutions, the American Postal Workers Union AFL-CIO Health Plan and the California Public Employees' Retirement System, both of which turned to SeeBeyond for application integration and business-to-business connectivity. The company also paired with Siebel Systems to launch UtilityEdge, an integration product for the energy and utility markets.