The B2B Analyst -- U.S. Bancorp Piper Jaffray's Weekly B2B Newsletter, Volume 2, Number 15

Apr 16, 2001, 01:00 ET from U.S. Bancorp Piper Jaffray Inc.

    MINNEAPOLIS, April 16 /PRNewswire/ --
 
     Looking for more insight on the B2B e-commerce market?
     -- Each Friday morning Jon and Tim conduct a live interview with
        RadioWallStreet.  To listen live, go to radiowallstreet.com at
        9:00 a.m. PST.  Interview archives are also maintained on the
        RadioWallStreet Web site.
 
     April 12, 2001
     In This Week's B2B Analyst:
     I.   INDEX -- U.S. Bancorp Piper Jaffray B2BEC Index
     II.  The "e" Takes Its place Among The Alphabet Of Commerce -- B2B and B2C
          companies alike are reevaluating their business models, incorporating
          e-commerce as another channel by which to generate business, rather
          than trying to replace traditional forms of commerce.
     III. Weekly News
 
     I.  INDEX -- U.S. Bancorp Piper Jaffray B2BEC Index
     Close:                     24.36              Past Week:  +4.18  (+20.7%)
     Year To Date:             -43.97  (-64.4%)    Past Month:  -2.6   (-9.7%)
     Since Inception (7/1/99): -75.64  (-75.6%)    Past Year: -83.02  (-77.3%)
 
     II.  The "e" Takes Its place Among The Alphabet Of Commerce
     As the dust from the e-commerce frenzy settles, companies are taking an
 integrated view of commerce and are realizing the importance of
 diversification.  Despite the emergence and/or spinoff of strictly e-commerce
 business models, it is now apparent from the demise of many dot-coms that
 e-commerce alone cannot replace traditional sales channels.  Thus, many
 companies that previously "put all their eggs in one basket" are reevaluating
 business, opting to incorporate the "e" as a significant portion of the
 business, rather than treating it as the end-all be-all business model.
     It was easy to get carried away in the "e" hype, as companies viewed the
 Internet as a new channel through which to do business.  Not only did it
 require a different architecture and infrastructure, but the Market was also
 rewarding these "pure-play" entities with sky-high valuations.  As a result,
 B2B and B2C start-ups sprung up everywhere, while already existing
 bricks-and-mortar companies developed and ran them separately, including
 Kmart's (#) bluelight.com and Barnes and Noble's barnesandnoble.com, among
 others.
     However, problems have arisen from the division between online and offline
 business models, as the two often fail to communicate with each other.  For
 example, a customer who ordered online and then called to change the order at
 a later date would encounter problems because the person answering the phone
 would have no record of the online transaction, and vice versa.  While the two
 entities are valuable in isolation, the potential realized by the sum of the
 two is undoubtedly greater than its parts.
     In addition to the kinks in integrating traditional and nontraditional
 forms of business, challenges have emerged in the adoption phase.  Companies
 have begun to realize that suppliers and customers are not quite ready to
 completely move all transactions and communication to the Internet.  Rather,
 they prefer to conduct business in a variety of ways -- Internet, telephone,
 e-mail, fax, in-person, wireless, etc. -- and the Internet is just one way,
 albeit a very cost effective one.  Both B2B and B2C companies have to be able
 to handle business across a wealth of channels, allowing for the integration
 and sharing of information among all information systems.  Consequently,
 companies are beginning to roll the dot-com businesses back under the
 corporate umbrella, consolidating information systems in order to have a
 complete 360-degree view of their business.
     As a result, companies that can only offer pure Internet solutions and
 cannot address multiple channels run the risk of losing their relevance unless
 they can easily integrate data and processes with the other channels.  There
 is not only room for all forms of commerce, but demand for it.  Thus, we
 believe those businesses that maintain diverse models are the ones that will
 prosper, allowing e-commerce to enhance a company's growth potential, rather
 than determine it.
 
     III.  WEEKLY NEWS
     -- Kana Communications (#) announced that it will acquire Broadbase
        Software in a $71.4 million stock-based deal, which is expected to
        close in the third quarter.  The combined entity will be known as Kana
        Software.
     -- Commerce One (#@) appointed Dennis Jones, the former CIO of FedEx (#),
        as its COO and vice chairman.
     -- Click Commerce (#) announced that it was selected by Lincoln Electric
        Holdings, a manufacturer of welding products, to develop a private
        e-marketplace.
     -- FreeMarkets (#) announced a new two-year agreement with existing client
        Eaton Corporation and signed a one-year agreement with the airline
        alliance Oneworld to source selected goods and services for its member
        organizations.
     -- Manugistics Group (#) announced that The Barilla Group is using
        Manugistics NetWORKS solutions in Italy to optimize its supply chain
        collaborative network.
 
     Some or all of the following hedges may pertain: (#)U.S. Bancorp Piper
 Jaffray Inc. makes a market in the company's securities. (~)A U.S. Bancorp
 Piper Jaffray Inc. officer, director, or other employee is a director and/or
 officer of the company. (@)Within the past three years, U.S. Bancorp Piper
 Jaffray Inc. was managing underwriter of an offering of, or dealer manager of
 a tender offer for, the company's securities or securities of an affiliate.
 Additional information is available upon request.
 
     Not FDIC Insured     No Bank Guarantee     May Lose Value
 
     This material is based on data obtained from sources we deem to be
 reliable; it is not guaranteed as to accuracy and does not purport to be
 complete.  This information is not intended to be used as the primary basis of
 investment decisions.  Because of individual client requirements, it should
 not be construed as advice designed to meet the particular investment needs of
 any investor.  It is not a representation by us or an offer or the
 solicitation of an offer to sell or buy any security.  Further, a security
 described in this publication may not be eligible for solicitation in the
 states in which the client resides.  U.S. Bancorp and its affiliated
 companies, and their respective officers or employees, or members of their
 families, may own the securities mentioned and may purchase or sell those
 securities in the open market or otherwise.  In the United Kingdom, this
 report may only be distributed or passed on to persons of the kind described
 in Article 11(3) of the Financial Services Act 1986 (Investment
 Advertisements) (Exemptions) Order 1996 (as amended by the Financial Services
 Act 1986 (Investment Advertisements) (exemptions) Order 1997). Securities
 products and services offered through U.S. Bancorp Piper Jaffray Inc., member
 of SIPC and NYSE, Inc., a subsidiary of U.S. Bancorp.
 
 

SOURCE U.S. Bancorp Piper Jaffray Inc.
    MINNEAPOLIS, April 16 /PRNewswire/ --
 
     Looking for more insight on the B2B e-commerce market?
     -- Each Friday morning Jon and Tim conduct a live interview with
        RadioWallStreet.  To listen live, go to radiowallstreet.com at
        9:00 a.m. PST.  Interview archives are also maintained on the
        RadioWallStreet Web site.
 
     April 12, 2001
     In This Week's B2B Analyst:
     I.   INDEX -- U.S. Bancorp Piper Jaffray B2BEC Index
     II.  The "e" Takes Its place Among The Alphabet Of Commerce -- B2B and B2C
          companies alike are reevaluating their business models, incorporating
          e-commerce as another channel by which to generate business, rather
          than trying to replace traditional forms of commerce.
     III. Weekly News
 
     I.  INDEX -- U.S. Bancorp Piper Jaffray B2BEC Index
     Close:                     24.36              Past Week:  +4.18  (+20.7%)
     Year To Date:             -43.97  (-64.4%)    Past Month:  -2.6   (-9.7%)
     Since Inception (7/1/99): -75.64  (-75.6%)    Past Year: -83.02  (-77.3%)
 
     II.  The "e" Takes Its place Among The Alphabet Of Commerce
     As the dust from the e-commerce frenzy settles, companies are taking an
 integrated view of commerce and are realizing the importance of
 diversification.  Despite the emergence and/or spinoff of strictly e-commerce
 business models, it is now apparent from the demise of many dot-coms that
 e-commerce alone cannot replace traditional sales channels.  Thus, many
 companies that previously "put all their eggs in one basket" are reevaluating
 business, opting to incorporate the "e" as a significant portion of the
 business, rather than treating it as the end-all be-all business model.
     It was easy to get carried away in the "e" hype, as companies viewed the
 Internet as a new channel through which to do business.  Not only did it
 require a different architecture and infrastructure, but the Market was also
 rewarding these "pure-play" entities with sky-high valuations.  As a result,
 B2B and B2C start-ups sprung up everywhere, while already existing
 bricks-and-mortar companies developed and ran them separately, including
 Kmart's (#) bluelight.com and Barnes and Noble's barnesandnoble.com, among
 others.
     However, problems have arisen from the division between online and offline
 business models, as the two often fail to communicate with each other.  For
 example, a customer who ordered online and then called to change the order at
 a later date would encounter problems because the person answering the phone
 would have no record of the online transaction, and vice versa.  While the two
 entities are valuable in isolation, the potential realized by the sum of the
 two is undoubtedly greater than its parts.
     In addition to the kinks in integrating traditional and nontraditional
 forms of business, challenges have emerged in the adoption phase.  Companies
 have begun to realize that suppliers and customers are not quite ready to
 completely move all transactions and communication to the Internet.  Rather,
 they prefer to conduct business in a variety of ways -- Internet, telephone,
 e-mail, fax, in-person, wireless, etc. -- and the Internet is just one way,
 albeit a very cost effective one.  Both B2B and B2C companies have to be able
 to handle business across a wealth of channels, allowing for the integration
 and sharing of information among all information systems.  Consequently,
 companies are beginning to roll the dot-com businesses back under the
 corporate umbrella, consolidating information systems in order to have a
 complete 360-degree view of their business.
     As a result, companies that can only offer pure Internet solutions and
 cannot address multiple channels run the risk of losing their relevance unless
 they can easily integrate data and processes with the other channels.  There
 is not only room for all forms of commerce, but demand for it.  Thus, we
 believe those businesses that maintain diverse models are the ones that will
 prosper, allowing e-commerce to enhance a company's growth potential, rather
 than determine it.
 
     III.  WEEKLY NEWS
     -- Kana Communications (#) announced that it will acquire Broadbase
        Software in a $71.4 million stock-based deal, which is expected to
        close in the third quarter.  The combined entity will be known as Kana
        Software.
     -- Commerce One (#@) appointed Dennis Jones, the former CIO of FedEx (#),
        as its COO and vice chairman.
     -- Click Commerce (#) announced that it was selected by Lincoln Electric
        Holdings, a manufacturer of welding products, to develop a private
        e-marketplace.
     -- FreeMarkets (#) announced a new two-year agreement with existing client
        Eaton Corporation and signed a one-year agreement with the airline
        alliance Oneworld to source selected goods and services for its member
        organizations.
     -- Manugistics Group (#) announced that The Barilla Group is using
        Manugistics NetWORKS solutions in Italy to optimize its supply chain
        collaborative network.
 
     Some or all of the following hedges may pertain: (#)U.S. Bancorp Piper
 Jaffray Inc. makes a market in the company's securities. (~)A U.S. Bancorp
 Piper Jaffray Inc. officer, director, or other employee is a director and/or
 officer of the company. (@)Within the past three years, U.S. Bancorp Piper
 Jaffray Inc. was managing underwriter of an offering of, or dealer manager of
 a tender offer for, the company's securities or securities of an affiliate.
 Additional information is available upon request.
 
     Not FDIC Insured     No Bank Guarantee     May Lose Value
 
     This material is based on data obtained from sources we deem to be
 reliable; it is not guaranteed as to accuracy and does not purport to be
 complete.  This information is not intended to be used as the primary basis of
 investment decisions.  Because of individual client requirements, it should
 not be construed as advice designed to meet the particular investment needs of
 any investor.  It is not a representation by us or an offer or the
 solicitation of an offer to sell or buy any security.  Further, a security
 described in this publication may not be eligible for solicitation in the
 states in which the client resides.  U.S. Bancorp and its affiliated
 companies, and their respective officers or employees, or members of their
 families, may own the securities mentioned and may purchase or sell those
 securities in the open market or otherwise.  In the United Kingdom, this
 report may only be distributed or passed on to persons of the kind described
 in Article 11(3) of the Financial Services Act 1986 (Investment
 Advertisements) (Exemptions) Order 1996 (as amended by the Financial Services
 Act 1986 (Investment Advertisements) (exemptions) Order 1997). Securities
 products and services offered through U.S. Bancorp Piper Jaffray Inc., member
 of SIPC and NYSE, Inc., a subsidiary of U.S. Bancorp.
 
 SOURCE  U.S. Bancorp Piper Jaffray Inc.

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