Ariba dumps i2 as market leaves them behind

The company claimed that a significant contributory factor to the breakdown is the market shift to private exchanges and the different requirements that come with that. Ariba said that i2 cannot deliver adequate software solutions for these exchanges.

Nick Earle, president and general manager EMEA, said: "At the time, it was the right thing to do. Now, public marketplace revenues are almost zero."

The troubled partnership, which also includes IBM, was formed in March of last year to focus on selling software for public online marketplaces.

However, the alliance started to show signs of faltering in the latter half of last year and analysts have been watching developments closely.

Earle explained that as a supply chain management (SCM) company, i2 does not fit with Ariba's strategy for addressing private exchanges. On Wednesday, Ariba launched its value chain management (VCM) strategy and said that on top of supply chain management, VCM will automate key processes between companies addressing both product and operations chains.

Earle said: "i2 doesn't do Value Chain management (VCM)." But he predicted that it will make the move to VCM and subsequently become a direct competitor.

The companies will still collaborate on e-procurement sales. Ariba will provide its 'Buyer' solution and i2 will continue to provide the supply chain solution.