The Bloor Perspective: Commerce One not at your service

Commerce One is spinning off parts of its business it believes can 'stand alone'. A big part of this spin-off means getting rid of the services organisation that cost it $1.28bn only 15 months ago. It's hard to know if this is because the services arm can genuinely operate independently or whether Commerce One needs to concentrate more on its core activities.

The fact is that there are a great many businesses that are busy realigning themselves to meet the current market conditions and, coming only a month or so after its latest set of financial results, we could be forgiven for thinking that Commerce One is doing the same.

It seems that the firm has abandoned its plans for a global consulting division altogether and is selling off the assets of the AppNet acquisition of June 2000. AppNet became Commerce One Global Services in September 2000. One part of the original acquisition, EDC, has already gone through a management buyout.

What is interesting here, is that Commerce One is one of the businesses that most of us would have expected to need a strong services capability. It is supposed to be positioning itself as the leader in the development of e-markets, an area typically very reliant on external services.

Over a period of about a year and a half, Commerce One has been getting more and more friendly with SAP.

SAP is an investor in the company with a 20 per cent holding and the two have been collaborating on a number of B2B solutions and projects. There has also been some discussion of Commerce One removing a substantial part of its sales force in order to concentrate on distributor and other channels.

Could it be that Commerce One is actually gearing itself up for some kind of takeover or merger with SAP? There is no direct evidence that this is the case but why else would a company start to spin-off parts of its organisation that might be duplicated in another partnership?