Facts & Figures For The Chemical Industry
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   Sept. 10, 2001
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Volume 79, Number 37
CENEAR 79 37 p.21
ISSN 0009-2347

E-BUSINESS
NEWS UPDATES FOR THE WORLD OF BUSINESS ONLINE

Marketplaces


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ELEMICA has added six new members to its 22 original investing founders following its acquisition of ElastomerSolutions. The new members are Cabot, Crompton's Uniroyal Chemical, DuPont Dow Elastomers, Flexsys, PolyOne, and Zeon Chemicals. Bayer and DSM, which helped create ElastomerSolutions, are already Elemica members. The remaining two ElastomerSolutions members, Enichem and Advanced Elastomer Systems, have not signed agreements to join. Elemica was created by chemical producers to help manage contractual relationships, transactions, and supply-chain connectivity among buyers and sellers.

eGLOBALCHEM is shutting down operations, reportedly after losing funding from one of its lead investors. The Marlborough, Mass.-based firm was attempting to create an online business-to-distributor-to-business marketplace for the worldwide specialty chemicals industry. Celanese and Arch Chemicals provided seed funding in August 2000. eGlobalChem later partnered with ShipChem for logistics and Ariba for software technology. In October 2000, it engaged Deloitte & Touche as an adviser on a proposed second round of funding aimed at raising $20 million to $30 million. It launched its marketplace in February 2001. eGlobalChem's website is still active, but its phone lines are not.

CHEMXL has launched a new chemical industry website offering user self-directed sales and procurement events. ChemXL says that it is not an intermediary, but instead offers the advantages of e-commerce while preserving existing procurement and sales relationships and processes. Online access is quick and easy, it says, for companies wanting to buy or sell chemicals but not wanting to pay membership fees, constantly monitor exchange activity, or develop and build their own back-end private exchange capabilities. ChemXL is a privately funded e-business venture with directors from chemical production and distribution companies.


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Services


CIDX, Chemical Industry Data Exchange, will work with RAPID, a nonprofit group that assists and supports electronic commerce activities in agribusiness, to develop XML-based standards for electronic business transactions within and between the two industries. CIDX set up a similar collaboration with the Petroleum Industry Data Exchange (PIDX) in June. These alliances are attempting to meet common needs for the development of electronic standards in business-to-business transactions. "By pooling the resources and expertise of key trading industries, we can accelerate this development while meeting the unique needs of each industry," CIDX says. Although data elements and definitions related to specific products and business processes may differ, the framework needs are fairly common across all industries, CIDX notes.

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CHEMICAL ABSTRACTS SERVICE (CAS) will expand the features of its database products by this fall. In the latest SciFinder 2001 release, it has incorporated the BLAST algorithm for searching DNA or protein sequences. Added features to SciFinder and STN search services include chemical substance information from Advanced Chemistry Development Inc., another 10 years of reaction information--to 1975--from InfoChem GmbH, and citation searching. CAS has also joined with informatics firm Spotfire to couple CAS's Explore chemical structure search capabilities with Spotfire's DecisionSite eAnalytic applications for their mutual customers. The combination offers desktop research tools for database access and data visualization and analysis.


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Companies


ASTRAZENECA has contracted with GeneEd to create instructional materials for its employees. GeneEd develops and implements Web-based life sciences courses that it calls "e-Learning courseware." Under the agreement, GeneEd will develop interactive courseware for AstraZeneca's clinical personnel in six major therapeutic areas. GeneEd says the contract with AstraZeneca is its largest to date. It also works with GlaxoSmithKline, Alza, Celera Genomics, and IBM Life Sciences.

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DOW CHEMICAL is working with ClearForest Technology, New York City, to expand its text-mining capabilities. Going beyond Internet search tools or data management, text mining allows exploring for complex relationships among documents that are in various formats. Dow is using text mining with the goal of discovering knowledge and patterns of information that are nonrecognizable or nonretrievable using traditional tools. It is looking at hundreds of thousands of documents on the Internet and from other sources. Dow believes it can use the technology to find new customers, technologies, business partners, or marketing trends.


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OUTLOOK

FROST & SULLIVAN says strong revenue models and innovative approaches will be key to the survival of chemical industry electronic marketplaces. In 2000, third-party dot-coms accounted for nearly 78% of e-marketplaces, with industry consortia or company-owned marketplaces making up most of the remainder. However, few chemical producers were willing to surrender any significant portion of their sales or purchase price as transaction fees to the dot-coms on a long-term basis, the market research firm notes. On top of that, lack of industry experience, coupled with flawed revenue models based on short-term business plans, made it difficult for the dot-coms to become profitable or survive. Exchanges such as ChemConnect, in which leading chemical firms took equity positions and agreed to make their preferred trading or procurement platforms, were among the handful to survive, Frost & Sullivan concludes. Meanwhile, companies such as GE Plastics and Enron were developing innovative approaches of their own. GE used its core business strengths to identify greater functionality in electronic channels and interactions with end users. Enron used its position in energy products to build an online exchange, EnronOnline, that, unlike third-party dot-coms, makes money through its own buying and selling of products, financial derivatives, and risk management instruments.

Please send submissions for E-Business to Ann Thayer , a_thayer@acs.org

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Copyright © 2001 American Chemical Society

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Please send submissions for E-Business to Ann Thayer, a_thayer@acs.org
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