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B2B Gets A Nod From The European Union
In what could be an important test for the burgeoning business-to-business (B2B) market, the European Commission, the regulatory arm of the European Union, gave its blessing to Myaircraft.com, a join venture of U.S.— based United Technologies and Honeywell International that would provide "one-stop shopping" and supply management functions for all aerospace participants.
As the first B2B exchange approved by the commission, the decision signals encouragement for more B2B exchanges. Under the EU's Merger Regulation, MyAircraft.com was examined because it will function as venture jointly controlled by its parents. The companies notified the commission in early July as required by the merger law.
Similar to an ongoing investigation by the federal trade commission, the commission warned that it was trying to identify potential competition violations in B2B marketplaces, adding it was anxious to prevent the participating firms from exchanging sensitive pricing information. "MyAircraft.com is seen by third parties as a tool to make operations within the aerospace sector quicker, more efficient and less costly," the commission said in a statement issued Monday. "MyAircraft.com will in all likelihood face strong competition from other similar Web sites."
"There is some anxiety learning the rules," said Jim Lucier, an analyst with Prudential Securities. Because B2B is an entirely new type of business model, it is hard to determine "the borderline between competitive and anti-competitive...you have to be very careful about who has access to what information," he said.
Other aerospace manufacturers have followed suit and unveiled similar plans. However, not all B2B market places will qualify for review under the Merger Regulation. B2B electronic marketplaces set up by single companies, for example, would not fall under the regulation because there would be no concentration. Amelia Torres, a spokeswoman for the commission, told Reuters that exchanges such as such as Covisint, a B2B exchange between automakers General Motors, Ford Motor and DaimlerChrysler probably would not qualify for review under the EU's merger rules, although the Commission still expected the three companies to ask it to vet the project.
Lucier noted that the decision will inevitably let both industry and investors breathe a little easier. But Lucier cautioned that the trends in B2B could lead to some problems down the road.
‘The bigger trend is the [old economy] companies forming their B2B exchanges. The flow of venture capital to [Internet] start-ups is very largely drying up."
BSA Reaches Deal With Swedish Firm In Piracy Dispute
Business Software Alliance and the IFPI announced Monday that they reached a settlement with the Swedish DCM Group over a dispute regarding the production of CD-ROMs using unlicensed recordings and software. The industry association's investigation revealed that the DCM had manufactured a number of CD-ROMS, which contained encrypted software and MP3 files containing music by a number of well-known artists signed to IFPI members. Under the terms of the settlement, DCM, which is managed by parent company Digital Communication Media, will implement the International Recording Media Association (IRMA) code, which will aid the company in avoiding future infringements. DCM also will support BSA and IFPI efforts to advocate regulation of optical disc plants across Europe, as part of a European Union proposal to curb piracy. The Swedish company also agreed to contribute the equivalent of US$1.2 million to BSA/IFPI anti piracy efforts.
China Strikes Deal With NSI
China soon will start seeing the .org and .net domain features in its burgeoning Internet economy. Network Solutions Inc., the leading registrar of domain name services in the United States, announced that Chinese Domain Name has joined its premier partner program and will make NSI Registrar's .com, .net and .org domain names available to consumers in China, Taiwan and Hong Kong. The Internet population in China is up to nearly 17 million, according to Internet Data Corp. In China, NSI already has partnered with 14 domain name firms including First China Shanghai and China Info Highway.
In another major Sino-U.S. venture, Intel announced Tuesday it will create its first Internet exchange architectural development center in Beijing late this year. Intel Vice President and General Manager of the Network Processing Group Tom Franz told Xinhua News Agency that the move is intended to accelerate the development of networking and communications in China. Several Chinese domestic telecom companies have shown interest in the project. "The technology level of application-specific integrated circuits in China has lagged," said a representative of Huawei, one of the four non-state telecom companies in China. "Intel Internet exchange architecture provides us with an opportunity to catch up with the world-class development trend."
Chinese Locality Seeks to Ban Mobile Phone Use
Elsewhere in China, officials are considering banning one of the fastest growing markets: mobile phones. Following the move of Hong Kong, the city of Shenzhen, located in the Guangzhou province, is considering banning the use of cell phones while driving a vehicle. City officials are debating draft legislation, the Guangzhou-based Nanfang Dushi News reported, and if passed, Shenzhen would be the first mainland China city to introduce such a ban.
Taiwan High Tech Exports Break Records
China's trade with Taiwan is one of the key factors in last month's record-breaking exports. Taiwan's exports exceeded sales records last month, according to figures released by Taiwan's Ministry of Finance on Monday. Overseas sales last month rose 36.5 percent over the same month last year, to US$13.6 billion, while imports rose 41.9 percent to US$13.5 billion. Ministry of Finance Director of Statistics Hsu Kuo-chung said the rise in exports and imports is due mainly to the expansion of sales to the United States, Europe and Asia. Overseas sales of Taiwanese information and telecommunications goods, steel, optical equipment and other heavy industrial products rose 32.9 per cent in the first seven months of this year compared to their-earlier period, accounting for 70.2 percent of the island's exports.
- by Maureen Sirhal
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