German software giant SAP AG (NYSE: SAP) has teamed with Deutsche Bank AG to offer financial and technical services to firms that are engaged in online trading on SAP’s new business-to-business (B2B) network.
The move comes on the heels of a similar deal between one of SAP’s major competitors, Commerce One, Inc. and financial services giant Citigroup, Inc.
In that deal, Citigroup said it will become “the primary financial service provider on the Commerce One MarketSite Global Trading Portal, which will enable all buying organizations trading on MarketSite to take advantage of Citibank’s broad array of financial services.”
In the deal with Deutsche Bank, Germany’s largest financial services company, the two firms will work through SAP’s network of online B2B sites. They will be anchored by the mySAP.com Marketplace.
Both deals show how leading financial services companies are already starting to jockey to get prime positions on B2B electronic trading networks that analysts expect will become major sources of both national and international trade in the coming years.
Behind the E-Procurement Competitors
While SAP is one of the leading providers of Enterprise Resource Planning (ERP) software that runs corporate back end operations, it has fallen behind Commerce One and Ariba, Inc. in the red-hot market for Internet-based e- procurement software and services.
Both Commerce One and Ariba provide software that can be used for in-house e-procurement systems. The software interfaces with ERP software from companies like SAP and PeopleSoft, Inc. In addition, both Commerce One and Ariba have set up public B2B trading networks that are based on their software.
Since these B2B trading markets are in their infancy, however, some analysts say that giants like SAP have time to stake out their positions in the market with their own e-procurement modules. The alignment with Deutsche Bank is designed, in particular, to give SAP a leading position in the European market where Deutsche Bank has its strongest operations.
Deutsche Bank has offices in 68 countries and employs more than 90,000 people in five business divisions — Global Corporates and Institutions, Asset Management, Global Technology and Services, Corporates and Real Estate, and Retail and Private Banking.
Deutsche Bank said it will create the various online services for mySAP.com over the course of the next year. Such services, the company says, “will eliminate the time, cost and complexity of building trust relationships via the Internet with counterparts around the world.”
Deutsche Bank claims its financial expertise will also add a new facet to the B2B marketplaces that the two companies plan to develop together. “The joint establishment and operation of industry marketplaces is aimed at quickly aggregating powerful buying and selling communities,” the companies said.
The pair plans to add other service providers to the projects, focusing on participation from leading players in their respective industries to provide key services for the sites, which are slated to start opening by October.
Citibank To Operate Own Portal
In the deal with Commerce One, Citigroup’s e-Citi division of Citibank has announced plans to launch its own B2B portal that it says will provide e-commerce services to its worldwide corporate customers.
The company said its new portal is based on the Commerce One MarketSite Portal Solution and will enable its corporate customers in specific industries such as pharmaceuticals and telecommunications to access a series of hosted e-procurement applications.
Its parent, Citigroup, will also become Commerce One’s preferred financial services provider. Citigroup includes such companies as Citibank, Travelers Insurance, Solomon Smith Barney and Primerica Financial Services.