Ariba defends its B2B strategy

While some analysts say the onset of commoditisation has already started, Nick Earle, president and general manager of EMEA at Ariba, said this is not the case and that penetration of the European market is currently only five per cent in the UK, two per cent in Germany and one per cent in France.

Speaking in New York, Earle said: "The market turned against e-procurement - it changed its mind on growth rates, which I think is wrong."

Ariba made its name in e-procurement technologies and according to IDC has a 32 per cent market share. On Wednesday, the company announced its value chain strategy, which will see it provide products to help companies improve business processes with their trading partners; this includes design collaboration in addition to supply chain management.

Ariba said it is well placed to take full advantage of this emerging trend for collaboration between companies because of its background in e-procurement.

Earle said ERP vendors, who provide supply chain management software that "stays within the four walls of the organisation", will fight for survival. He said: "It's extremely unlikely that more than one ERP vendor will survive."

Ariba's share price has taken a severe knock over the recent months and pundits claimed its announcement yesterday was preoccupied with convincing the financial community that it is still strongly positioned.

Earle blamed the stock drop partly on the fact that the company had to keep quiet about its new strategy.

He added: "We've stayed quiet for too long and allowed ourselves to be positioned by other companies. Until the acquisition of Agile was complete, we could not explain to the financial analysts what our plans were. I think we should have moved on Agile three months earlier."