RosettaNet Meets Exchange Standard Challenge

Electronic News, June 4, 2001 by Rob Spiegel

Nonprofit consortium balances competition and cooperation

Anyone involved in the process of moving from traditional trading to Internet-based trading is well aware that the transition is more daunting than it seems from reading vendor press releases.

One of the biggest challenges is simply finding an appropriate language for exchanging information from trading partner to trading partner. So, the electronics industry formed a consortium to tackle the problem.

The result is Santa Ana, Calif.-based RosettaNet (rosettanet.org), a nonprofit organization created to set standards for the electronic exchange of trading data. Most of the early work at RosettaNet has involved developing Partner Interface Process (PIP) technology to help companies hook up and trade information.

"In just over three years, RosettaNet has accomplished far more than any other consortium of this nature," said Fadi Chehade, co-founder, chairman and chief technology officer of the Irvine, Calif.-based Viacore, a company involved in building private trading networks. Chehade is also the founder of RosettaNet. "They developed PIP standards in a very meticulous way. RosettaNet set very specific deadlines and milestones in order to keep everyone committed to the task at hand."

To move forward, RosettaNet has had to do a balancing act with hundreds of electronics companies, all of which have their own agendas and timetables to use standards.

"What is most amazing to me is that RosettaNet accomplished this feat of collaboration with the collective efforts of more than 400 members-and many members are competitors," Chehade said. "Rarely can a group this diverse actually drive such tangible change across an industry. Large-scale RosettaNet implementations are just now going into production, and I believe that toward the end of this year, or beginning of 2002, we will start to see industry-wide measurable results that can be directly traced back to RosettaNet."

How long does it take to create standards for the exchange of electronic information? Like most things in B2B e-commerce, it takes longer than expected.

"We thought at first we'd nail it in two years," said Colin Evans, director e-business strategy at Intel Corp. "Then reality set in. It's extraordinarily hard to get agreement on how companies work together." Evans characterized RosettaNet's challenge as accommodating a balance of business process and technology as well as juggling the politics of members who are competitors.

"I would segment RosettaNet's challenges as making things explicit in technology and in business rules," Evans said. "Both of those have their own dynamics from a political stand-point. RosettaNet's pace of progress far outstrips previous attempts. Relatively speaking, it's going very quickly."

One of the main missions of RosettaNet is to deliver standards that can be used openly, rather than just developing a set of standards that can be used by many-to-many trading partners, rather than just partner-to-partner.

"Initially it was formed around bilateral connections," said Mark Holman, chief executive officer of E2open, a Belmont, Calif.-based industry-sponsored e-marketplace for the electronics industry based in Belmont, Calif. "We've been working with them to develop many-to-many. I think its an evolution problem, When it was founded, many-to-many didn't exist. A new way of business is coming to market, and people want to take advantage of it."

Chehade agrees that RosettaNet is evolving beyond PIP and is now in a position to make real progress on open, many-to-many standards.

"I think RosettaNet has come to terms with the challenge of bilateral standards and is now implementing more flexible standards to help with many-to-many processes," Chehade said. "However, the reality is that no matter how flexible RosettaNet standards are, there will continue to be varying nuances in how businesses operate their supply-and-demand chains."